FORM 10-KSB

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

          Annual Report Pursuant to Section 13 or 15(d) of the 
                      Securities Exchange Act of 1934

                For the fiscal year ended December 31, 1998

                      Commission File Number:  0-17170

                              TELVUE CORPORATION

      (Exact name of small business issuer as specified in its charter)

         Delaware                                       51-0299879      
(State or other jurisdiction of                       (I.R.S. Employer
incorporation or organization)                        Identification No.)

     16000 Horizon Way, Suite 500
       Mount Laurel, New Jersey                            08054
(Address of principal executive offices)                 (Zip Code)
  
Issuer's telephone number, including area code:  609-273-8888
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None

      Title of Each Class

      Common, $0.01 per share par value

Indicate by check mark whether the Issuer (1) has filed all reports 
required to be filed by Section 13 or 15(d) of the Securities Exchange Act 
of 1934 during the preceding 12 months (or for such shorter period that the 
Issuer was required to file such reports) and (2) has been subject to such 
filing requirements for the past 90 days.  Yes  X
                                              -----

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

The Issuer's revenue for the fiscal year ended December 31, 1998 was 
$6,122,249.

The Market Value of voting stock held by non-affiliates of the Issuer March 
1, 1999, based on a per share average bid and asked price of $.1138 was 
$1,040,729.

Number of shares of Issuer's common stock outstanding as of
March 1, 1999: 24,194,500 shares.

Transitional Small Business Disclosure Format:  Yes       No   X
                                                    _____    _____  

<PAGE>

ITEM 1.     BUSINESS

GENERAL

      TelVue Corporation, a Delaware corporation (the "Company"), was 
incorporated on November 26, 1986.  Until December 30, 1988, the Company 
was a wholly owned subsidiary of Science Dynamics Corporation ("Science"). 
On that date, the Company's shares of Common Stock were distributed to 
Science's shareholders of record as of December 30, 1988, on the basis of 
three shares of the Company's Common Stock for each share of Science's 
Common Stock then outstanding.  The Company is a marketing and operating 
company primarily selling automatic number identification ("ANI") 
telecommunications services to the cable television industry for the 
automated ordering of pay-per-view features and events (the "Service").

     ANI permits cable television companies to process special ordering 
services without the attendant high-manpower requirements or extensive 
physical plant and facilities that are otherwise required.  ANI systems 
provide an electronic means of recording a subscriber's telephone number 
together with information as to what program or service was ordered and by 
whom, permitting cable television companies to then unscramble appropriate 
signals for viewing by the ordering subscriber, all without any interactive 
cable system and without any form of operator intervention.  At the time of 
dialing the order, the recognition of the subscriber's telephone number is 
automatically recorded by the Company's ANI unit, presenting the subscriber 
with both a confirmation and acknowledgment of receipt of his order.  In 
turn, the automatically recorded information regarding placement of an 
order is utilized by cable television companies for purposes of billing for 
such specialized services.

  The Company's equipment for providing the Service nationwide is located 
at the Company's home office in Mt. Laurel, New Jersey.  The equipment 
provides enhanced service features.  These enhanced service features, which 
identify the cable operator by name ("Custom Greeting") and, on accepted 
orders, speaks the movie or event title, start-time and channel appearance 
("Title Speak"), are necessary, the Company believes, for it to remain 
competitive within the pay-per-view ANI industry.  The equipment also 
speaks promotional messages for products and services at the time a cable 
subscriber is placing an order for a pay-per-view movie or event (the "PPV+ 
service").  The Company serves cable television systems across the United 
States via trunk lines and data circuits that it currently leases from 
MCIWorldcom. The Company believes it receives a favorable trunk usage rate 
from MCIWorldcom.  

     The equipment used to provide the Service is owned and installed by 
the Company.  As of December 31, 1998, the Company had contracts to provide 
service to 693 cable television systems, serving approximately 11.4 million 
full-time subscribers and 1.3 million part-time subscribers.  Part-time 
subscribers are subscribers who only use the Company's ANI service for 
major special events, such as boxing, wrestling and concerts.  The Company 
is marketing and providing service to cable television systems on a part-
time basis because it wants cable television systems who are using 
alternate pay-per-view ordering services to become familiar and comfortable 
with the Company's ANI service in anticipation that these cable television 
systems may choose to use the Company's ANI service on a full-time basis.

     The Company's contracts with cable television system operators cover 
the provision of ANI order entry services at a specified rate per 
subscriber order.  Cable television systems are charged, in addition to 
their per order fee, installation and setup fees, monthly data circuit 
fees, enhanced feature fees and PPV+ service promotion fees.  Monthly 
charges are due and payable to the Company within twenty days of the end of 
each month. Generally, the contracts carry an initial term of three years 
with automatic renewal unless a party gives notice of non-renewal prior to 
the renewal date.  Generally, the contracts are terminable at will upon 
ninety days prior notice (subject to applicable cancellation fees).  Each 
contract is also terminable upon default by a party.  In addition, the 
contract is also assignable upon the sale or transfer of the business or 
assets of the cable operator.

      The Company's business is oriented principally to the provision of 
services, and it does not engage in the manufacture of equipment required 
to provide its services.  During 1998, the Company purchased its required 
ANI equipment and software from Telco Solutions, Inc.

      For information regarding the Company's revenue, operations and 
assets, please refer to the Company's financial statements included at Item 
7 of this Report and Management's Discussion and Analysis or Plan of 
Operation.

LICENSES

      The Company has previously purchased Switched-access Audio Response 
Units ("SARUs") and one communication subsystem ("HP") from Atlas Telecom 
(formerly Syntellect).  The Company possesses a perpetual, no charge 
license for the pay-per-view application software residing on the SARUs it 
currently owns and for any future SARUs purchased. The Company purchased no 
SARUs from Atlas Telecom during 1998. There is no affiliation between the 
Company and Atlas Telecom other than a customer and supplier relationship.

     The Company pays Telco Solutions, Inc. a monthly licensing fee for an 
exclusive license, within the United States, for use of pay-per-view 
application software which resides on two (2) communication subsystems 
("HPs") that the Company owns.  The Company purchases Link On equipment 
("LINK ONs") from Telco Solutions, Inc.  The LINK ONs are used to expand 
call capacity to accommodate new customers.  The LINK ONs work in 
conjunction with the SARUs.  The Company is purchasing LINK ONs in place of 
SARUs because the LINK ONs are more cost effective.  The Company pays Telco 
Solutions, Inc. a monthly licensing fee for an exclusive license, within 
the United States, for use of the pay-per-view application software 
residing on the LINK ONs.  The Company purchased two (2) LINK ONs during 
1998.

     The Company also uses equipment purchased from Science.  Science holds 
United States Patent No. 4,797,913 (issued January 10, 1989), encompassing 
ANI ordering equipment and services employing the use of Feature Group D 
services (the "Science Patent").  The Company holds a nonexclusive license 
to use the Science Patent.  

MARKETING OF SERVICES

      Sales of the Company's services to date have been made to operating 
cable television companies with a broad geographical distribution.  
Relations with all customers are good.

      The Company's business is not seasonal in any material respect. 
Ordering problems common to all providers of pay-per-view services are the 
geographically dispersed points of sale, the high concentration of orders 
around the start time of a pay-per-view event and the need to make the 
ordering mechanism sufficiently easy to accommodate the impulsive 
purchasing patterns of ordering subscribers.  The Company believes its 
services resolve these pay-per-view ordering problems.  As of December 31, 
1998, there are four (4) Multi System Operators ("MSOs") who individually 
comprise greater than 10% of the Company's annual service revenue.  These 
percentages may vary as contracts with additional cable companies are 
concluded and the pay-per-view service is expanded by existing customers of 
the Company.

COMPETITION

     The Company uses state-of-the-art, feature laden equipment for its 
automated pay-per-view order processing service.  The Company has a strong 
reputation for offering customer friendly features and excellent customer 
service. In addition, the Company offers 24-hour customer service and 
reliability with near zero down time, particularly under heavy load during 
major special events.  Although competition is strong from the Company's 
major competitor, the Company is attracting significant numbers of new 
customers.  The Company's aggressive marketing strategies and reputation 
allowed it to grow its full-time customer base by 14% to approximately 11.4 
million full-time addressable homes in 1998, which makes it the largest 
service provider of ANI pay-per-view ordering service to the cable 
industry. The Company plans to continue its marketing approach during 1999 
and believes that strategy will provide continued growth in numbers of 
subscribers.

EMPLOYEES

      At December 31, 1998, the Company had 17 full-time employees.  
Additional personnel may be added as the Company's business develops and as 
circumstances require.
 
BACKLOG

      The Company's revenues are computed and assessed on the basis of a 
fixed charge for every order placed with a subscribing customer for 
specialized cable programming service or for other services transmitted 
through its equipment.  As a result, no form of backlog exists, other than 
as represented by accumulated service charge income which has yet to be 
paid to the Company.

RESEARCH AND DEVELOPMENT 

     The Company is principally a sales and marketing company.  Therefore, 
the Company does not anticipate that it will perform any significant or 
material research and development. 

ITEM 2.     PROPERTIES

      The Company leases office space of approximately 8,700 square feet in 
the Mt. Laurel, New Jersey, Horizon Way Corporate Center.  The lease 
expires May 31, 1999.  The Company intends to renew its lease.  The office 
space is used to house the equipment used to provide the Service as well as 
the Company's present executive, sales, secretarial and technical support 
personnel.

ITEM 3.     LEGAL PROCEEDINGS

      In April 1996, a former employee filed suit against the Company and its 
majority stockholder, James T. Shelley vs. TelVue Corporation and H.F. 
Lenfest, with the Superior Court of Burlington County, New Jersey, Civil 
Action Number 01368-96 (the "Shelley Case").  The complaint alleged breach 
of contract, breach of implied covenant of good faith and fair dealing 
detrimental reliance and unjust enrichment.  The lawsuit sought compensation 
and compensatory damages.  Although the Company believed the employee's 
claims were without merit, the  Company settled the lawsuit in June 1998, 
after considering the amount the Company's insurance carrier was willing to 
reimburse the Company versus the legal fees that would be incurred if the 
case went to trial.  The Company has recorded $33,430 in litigation 
settlement expense, net of proceeds received from the Company's insurance 
carrier.

      The Company has received notice from a cable operating company 
customer asserting its right to be indemnified against claims of patent 
infringement made to the cable operator by a third party.  The third party 
has alleged to the cable operator that portions of the cable operator's 
pay-per-view operations infringe one or more patents held by such party.  
No notice of alleged infringement has been received by the Company from 
such third party. The Company has retained independent patent counsel to 
review the terms and the alleged infringement.  The Company is unable at 
this time to determine the amount or extent of liability, if any, to the 
cable operator.
 
ITEM 4.     SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

      No matter was submitted during the fourth quarter of the fiscal year 
covered by this report to a vote of security holders through solicitation 
of proxies or otherwise.

ITEM 5.     MARKET FOR THE ISSUER'S COMMON STOCK AND RELATED               
            SECURITY HOLDER MATTERS

      The Issuer's Common Stock is traded in the Over-the-Counter Market. 
Over-the-Counter market quotations reflect inter-dealer prices, without 
retail mark-up, mark-down or commissions and may not represent actual 
transactions.  The range of high and low bid prices for the Company's 
common stock for the two most recent fiscal years, as reported by The 
NASDAQ Stock Market, Inc. is as follows:

      QUARTER 1998                          HIGH                    LOW

        First                               $.09                   $.06

        Second                              $.23                   $.08
    
        Third                               $.10                   $.06

        Fourth                              $.11                   $.03


      QUARTER 1997

        First                               $.03                   $.03

        Second                              $.03                   $.03
 
        Third                               $.03                   $.02

        Fourth                              $.06                   $.03

      As of March 1, 1999, there were 394 holders of record of the Common 
Stock of the Company.

      The Company has paid no cash dividends since its incorporation.  The 
Company intends to retain any future earnings for use in its business and 
has no present intention to pay cash dividends on its Common Stock in the 
foreseeable future.  Holders of the Common Stock are entitled to share 
ratably in dividends when and as declared by the Board of Directors out of 
funds legally available therefore.
 
      Shares of Common Stock which have had the same beneficial owner since 
April 21, 1988, or which have had the same beneficial owner for a 
continuous period in excess of two years prior to the record date of any 
meeting of stockholders, are entitled to 10 votes per share in any matters 
submitted for vote, at a meeting of stockholders.  All other stockholders 
have one vote per share unless this limitation is waived by the Board of 
Directors.  As of December 31, 1998, 18,083,512 shares of the Company's 
Common Stock were entitled to 10 votes per share.  The remaining 6,110,988 
shares of Common Stock were entitled to one vote per share.  Mr. Lenfest 
owns 14,557,453 shares of Common Stock which are entitled to ten votes per 
share.

ITEM 6.     MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

     Net income before income taxes was $781,158 for the year ended December 
31, 1998, compared $642,197 for the year ended December 31, 1997.  The 
Company experienced a decrease in the average monthly buy rate from 21.7% 
for the year ended December 31, 1997, to 17.2% for the year ended December 
31, 1998.  The drop in the buy rate caused the pay-per-view buy revenue to 
decrease approximately $361,000. The Company believes the decrease in the 
buy rates for the year ended December 31, 1998, is attributable to a 
somewhat weak movie product and a lack of major special events. Although the 
pay-per-view buy revenue decreased, the Company had an increase in feature 
revenue of $251,011 as a result of the Company serving approximately 
1,400,000 more full-time subscribers at December 31, 1998.  PPV+ service 
revenue decreased $119,136 for the year ended December 31, 1998. PPV+ 
service revenue decreased as a result of the buy rate decrease (see above) 
and fewer major boxing events being broadcast.

     The Company had net income of $472,773 for the year ended December 31, 
1998 compared to $3,135,634 for the year ended December 31, 1997.  Included 
in net income is income tax expense of $308,385 for the year ended December
31, 1998 compared to an income tax benefit of $2,493,437 for the year ended
December 31, 1997.  The Company's income before income taxes is $781,158 for
the year ended December 31, 1998.  In 1997, the Company reduced its deferred
tax asset valuation allowance since the Company believed that it would
benefit from the full utilization of its net operating losses.  As of December
31, 1997, the valuation allowance was reduced to zero and, as a result,
there was no further reduction of the valuation allowance in 1998 and
no further resulting tax benefit.   As of December 31, 1998, the Company's
net operating loss carryforward is approximately $3,600,000 on a tax
reporting basis (see Note 7 to the Company's financial statements).

     Service expenses decreased $474,686 for the year ended December 31, 
1998.  This is primarily a result of a decrease in trunk expense of $437,087 
due to the buy rate decrease (see above) and a reduction in the telephone 
rates charged by MCIWorldcom.

     During June 1998, the Company settled a lawsuit filed by a former 
employee and recorded litigation settlement expense of $33,430, net of 
proceeds received from the Company's insurance carrier (See Legal 
Proceedings).

     As of December 31, 1998, the Company was serving approximately 
11,400,000 full-time cable subscribers and 1,300,000 part-time subscribers, 
compared to approximately 10,000,000 full-time cable subscribers and 
1,500,000 part-time subscribers served as of December 31, 1997.  The part-
time subscribers did not significantly contribute to the revenue or service 
expenses for the year ended December 31, 1998 and 1997.  However, during the 
year ended December 31, 1998, 211,000 part-time subscribers converted to 
using the Company's service on a full-time basis.

      The Company's operations had required a substantial purchase of 
equipment by the Company.  During the year ended December 31, 1998, the 
Company purchased $303,996 of equipment compared to $513,676 purchased 
during the year ended December 31, 1997.  Depreciation accounted for 18% of 
total operating expenses for the year ended December 31, 1998, compared to 
16% for the year ended December 31, 1997.  For the year ended December 31, 
1998, both selling and marketing expenses and general and administrative 
expenses marginally increased approximately 1% each.

     The Company's software for its pay-per-view ANI ordering is "Year 2000 
Compliant".  The Company' long distance telecommunications provider, 
MCIWorldcom, has informed the Company that they have implemented a 
Strategic Year 2000 Compliance Plan in which appropriate remedial action to 
non-compliant elements is being performed. Many telecommunications 
providers use the same switch suppliers.  Telecommunications companies, 
including MCIWorldcom, will not be able to declare their systems compliant 
until these switch manufacturers have completed their compliance programs. 
MCIWorldcom is targeting all systems to be compliant by the second quarter 
1999 to allow full testing and monitoring.  Interconnect agreements formed 
with other telecommunications companies mean that some of MCIWorldcom's 
services are dependent on third party carriers.  All the major 
telecommunications companies, including MCIWorldcom, rely to some extent on 
interconnect agreements with third parties and need to validate the 
compliance of these third parties.  In the event that MCIWorldcom is not 
Year 2000 compliant, there exists the possibility that the Company would 
not be able to receive telephones calls from the cable operator 
subscribers, and therefore, could not process any orders.  If MCIWorldcom 
does not become fully Year 2000 compliant during 1999, the Company will 
switch to another long distance telephone service provider who is Year 2000 
compliant.  As a result of such switch the Company would incur duplicate 
facility and data link costs for a few months due to temporarily having 
redundant facilities in service.

     The Company has also requested Year 2000 compliance certificates from 
the cable operator billing vendors to whom the Company transmits the pay-
per-view ordering data.  In the event that the billing vendors do not 
become Year 2000 compliant, the Company would not be able to transfer 
information regarding pay-per-view orders, and therefore, no pay-per-view 
orders could be fulfilled.  To date, the billing vendors have indicated 
they are working on being Year 2000 compliant.  The Company has verified, 
through testing, that one billing vendor is Year 2000 compliant with regard 
to processing the pay-per-view ordering information transmitted by the 
Company.  The Company plans to test the remaining billing vendors during 
the second quarter of 1999.  The Company's contingency plan would be 
determined by the cable operator's decision with respect to selecting a 
different billing vendor.

     A majority of the Company's software that it uses for administrative 
purposes is "Year 2000 Compliant".   The software that creates the customer 
invoices is not presently Year 2000 compliant.  The vendor of such software 
has made available software to upgrade to be Year 2000 compliant.  The 
Company is currently working on upgrading the software.  In the unlikely 
event that such software does not get upgraded, the Company would have to 
create its invoices in another software program that would be time 
consuming and involve some manual effort.

     The Company has performed its Year 2000 compliance checks internally 
and therefore has not incurred any related costs.  The Company expects the 
fees to be nominal for converting its administrative software to be Year 
2000 compliant.
 
      Total liabilities decreased $1,069,449 and total assets decreased 
$980,920 for the year ended December 31, 1998.  The decrease in total 
liabilities was primarily a result of a decrease in notes payable - majority 
stockholder of $1,900,000 due to debt repayment.  Partially offsetting the 
debt repayment is an increase in accrued interest of $507,116 on outstanding 
loans from Mr. H.F. Lenfest, the majority stockholder and Chairman of the 
Board of Directors of the Company ("Mr. Lenfest"), and an increase in 
accrued dividends on preferred stock of $422,244.  The decrease in assets is 
partially attributable to a decrease in deferred tax asset of $286,724 (see 
above and Note 7 to the financial statements), and an increase in 
accumulated depreciation of $823,172.  The Company's days for sales in 
accounts receivable is 51 days for the year ended December 31, 1998 compared 
to 53 days for the year ended December 31, 1997.  The Company does not offer 
incentives/discounts to its customers, nor has it changed its credit terms 
with its customers.

      The Company had positive cash flow from operations of $2,212,197 
during the year ended December 31, 1998.  Ignoring changes in operating 
assets and liabilities that result from timing issues, and considering only 
adjustments to reconcile net income to net cash provided by operating 
activities, the Company would have positive cash flow from operating 
activities of $1,667,593 for the year ended December 31, 1998, compared to 
positive cash flow from operating activities of $1,487,687 for the year 
ended December 31, 1997.  Cash flow for the year ended December 31, 1998, 
increased mainly as a result of a reduction in trunk expense due to a 
decrease in the MCIWorldcom rates during 1998 (see above).

     Since November 2, 1989, the Company has funded its expansion and 
operating deficit from the $2,500,000 of proceeds from the sale of shares of 
the Company's Common Stock and Preferred Stock to Mr. Lenfest and from 
borrowings from Mr. Lenfest.  From November 1989 to February 1996, the 
Company borrowed an aggregate of $6,128,712 from Mr. Lenfest.  The interest 
rates on the loans range from a floating rate based on the prime rate of PNC 
Bank to a fixed rate of 12%.  Interest on one of the loans in the principal 
amount of $1,471,272 as of December 31, 1998, is payable quarterly and, at 
the option of the Company may be paid by the delivery of shares of the 
Company's Preferred Stock at the rate of one share of Preferred Stock for 
each one dollar of accrued interest.  Interest due on this loan prior to 
1998, in the amount of $473,682 has been paid with 473,682 shares of 
Preferred Stock.  No Preferred Stock has been issued for 1998 accrued 
interest.  In addition, during January 1995, Mr. Lenfest purchased from 
Science the Company's non-interest bearing note in the amount of $541,000 
(the "Prior Science Note").

    Effective as of March 31, 1998, the Company obtained from Mr. Lenfest a 
written agreement stating he will not demand repayment of his loans or the 
cash payment of accrued interest on the loans through January 1, 2000.  The 
deferring of the interest payments has enabled the Company to accumulate 
cash.  Interest payments would have amounted to $507,116 for the year ended 
December 31, 1998, compared to $457,883 for the year ended December 31, 
1997.  During 1998, the Company had been making monthly principal payments 
of $150,000 to Mr. Lenfest and, at management's discretion, the Company made 
monthly principal payments in excess of $150,000 when the Company had cash 
not needed to fund operations.  In addition, at the direction of the Board, 
without the participation of Mr. Lenfest, effective January 1, 1998, the 
Company began accruing interest on all unpaid interest on all outstanding 
loan balances due to Mr. Lenfest. During 1998, the Company made principal 
payments of $1,900,000 to Mr. Lenfest.  The aggregate outstanding loan 
balances due to Mr. Lenfest as of December 31, 1998 are $2,419,712 in 
principal and $2,694,837 in accrued interest. Beginning January 1, 1999, the 
Company will voluntarily begin to pay current monthly interest payments to 
Mr. Lenfest from the $150,000 payment.  The balance of the payment will be 
applied to loan principal

      The Company believes that increases in accrued interest under the 
loans from Mr. Lenfest do not have a direct material effect on operations or 
continued availability of credit.  Cash flow from operations is sufficient 
to fund current operations but is insufficient to fund total debt repayment. 
The Company believes its suppliers look primarily to the Company's timely 
payment of outstanding invoices.  Historically, the Company has paid all the 
suppliers it deals with on a timely basis and, therefore, the cash flow from 
operations has no effect on the Company's availability of credit from key 
suppliers of goods and services.  The payment terms of the Company's 
equipment and software providers are net 30 days.

      The Company's ability to fund its operating expenses primarily depends 
on three factors: the continued expansion of the Company's subscriber base, 
the cable industry's buy rates, and the continued deferral by Mr. Lenfest of 
a lump sum cash repayment of his loans to the Company.  Management believes 
its present marketing strategies will further increase the customer base, 
although there can be no assurances that the Company will be able to attract 
any further customers or that it will retain its current customers.  In 
addition, revenues are affected by the "buy rates" of subscribers connected 
to the Service.  The Company has no control over the buy rates. As noted 
above, the Company experienced a decrease in the average monthly buy rate 
from 21.7% for the year ended December 31, 1997 to 17.2% for the year ended 
December 31, 1998, as a result of an industry wide drop in buy rates.  
Hence, there can be no assurance that buys rates will increase or will 
remain at their current level.

     The Company remains dependent upon the deferral of principal and 
interest payments due to Mr. Lenfest to fund operations and capital 
expenditures from operating cash flow.  Mr. Lenfest has agreed not to demand 
the cash repayment of principal or accrued interest on the outstanding loans 
through January 1, 2000.  Nevertheless, management intends to continue to 
repay the outstanding principal and current month interest amount of loans 
made by Mr. Lenfest from cash not needed for operations.  Management 
believes that the Company will have sufficient funds to continue such 
repayments and will be able to fund its core business from operating cash 
flow through December 31, 1999.
  
ITEM 7.     FINANCIAL STATEMENTS

      See Item 13 for a list of financial statements.

ITEM 8.     CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON               
              ACCOUNTING AND FINANCIAL DISCLOSURE

      There have been no disagreements of any nature at any time with the 
Company's auditors with regard to any aspect of the Company's financial 
statements, its financial disclosure or its accounting practices.

ITEM 9.     DIRECTORS AND EXECUTIVE OFFICERS OF ISSUER

      The following table sets forth certain information as of December 31, 
1998 with respect to each of the Company's directors and officers.
 
                                            POSITION(S) WITH       DIRECTOR
NAME                          AGE             THE COMPANY           SINCE  

H.F. (Gerry) Lenfest          68            Chairman of the          1989
                                            Board and Director

Frank J. Carcione             58            President,               1990
                                            Chief Executive
                                            Officer, and Director

Donald L. Heller              53            Director                 1993  

Joseph M. Murphy              45            Executive Vice           1997
                                            President of Sales
                                            & Operations, and
                                            Director

Joseph DiJulio                44            Director                 1998

Irene A. DeZwaan              35            Secretary & Treasurer    

      The employee directors of the Company receive no compensation.  Non-
employee directors (other than Mr. Lenfest) receive $500 paid in shares of 
common stock of the Company for each meeting of the Board attended.  The 
shares are priced at the higher of $.05/share or the ask price on the date 
of grant.  During 1998, Messers Heller and DiJulio, were entitled to 
receive 5,000 shares of common stock each.

      All directors serve until the next annual meeting of shareholders and 
until their successors have been elected and have qualified.  All officers 
serve at the discretion of the Board of Directors.

BUSINESS EXPERIENCE

      H. F. Lenfest has been a director of the Company since 1989.  He is 
the President, CEO and a director of Lenfest Communications, Inc. and each 
of its subsidiaries (the "Lenfest Group").  The Lenfest Group of companies 
are engaged in operating cable television systems, providing cable 
advertising and programming.  Mr. Lenfest's principal occupation since 1974 
has been President and CEO of Lenfest Communications, Inc. and The Lenfest 
Group of companies.

      Frank J. Carcione has been a director of the Company since 1990.  He 
became the Executive Vice President in May 1990, and was elected President 
and Chief Executive Officer in May 1991.  From August 1989 to May 1990, he 
held the position of Vice President (marketing, sales, pay-per-view and 
franchise relations) with Garden State Cablevision, L.P., a New Jersey 
cable television operator and an affiliate of The Lenfest Group of 
companies.  From November 1980 until August 1989, he held the same position 
with New York Times Cable TV, the predecessor to Garden State Cablevision, 
L.P.
    
      Donald L. Heller has been a director of the Company since 1993.  He 
has been a Vice President of Lenfest Communications, Inc. since March 1993. 
Prior to assuming his current position, Mr. Heller was, from June 1984 to 
January 1993, the Vice President and General Manager of Sports Channel 
Prism Associates, a regional cable television service that provides movies 
and professional sports.

     Joseph M. Murphy has been a director of the Company since 1997.  He is 
the Executive Vice President of Sales and Operations of the Company.  Mr. 
Murphy was appointed to this position in September 1994.  Prior to this 
appointment, Mr. Murphy had been Vice President of Sales since joining the 
Company in 1986.
 
     Joseph A. DiJulio has been the Vice President of Network Services 
since January 1995 and General Manager since July 1988 of Suburban Cable TV 
Company, Inc. ("Suburban"), a subsidiary of Lenfest Communications, Inc. 
From January 1993 through December 1995, Mr. DiJulio was a regional Manager 
of Suburban.  Mr. DiJulio has held various positions of increasing 
responsibility with Suburban since joining the company in June 1984.
     
     Irene A. DeZwaan, CPA, has been the Secretary and Treasurer of the 
Company since in July 1993.  Prior to this appointment, Ms. DeZwaan had 
been the Manager of Finance and Administration of the Company since 
November 1990.

     On December 6, 1995, the Securities and Exchange Commission (the 
"SEC") sued H.F. Lenfest and his wife, in the United States District Court 
for the Eastern District of Pennsylvania.  The SEC alleged that, in October 
1993, Mr. Lenfest, while in possession of non-public information, 
recommended to one of his sons that he purchase Tele-Communications, Inc. 
("TCI") stock and that his wife traded in TCI stock in October 1993 on the 
basis of information she misappropriated from her husband.  During October 
1998, the case was dismissed by the trial judge.

ITEM 10.    EXECUTIVE COMPENSATION 

                        SUMMARY COMPENSATION TABLE

                              ANNUAL  COMPENSATION   ALL OTHER   RESTRICTED
NAME AND                                              ANNUAL       STOCK
PRINCIPAL POSITION    YEAR    SALARY  COMMISSIONS  COMPENSATION    AWARDS

Frank J. Carcione     1998  $135,000       -        $3,375 (1)    $9,219(2)
CEO                   1997   124,950       -         3,124 (1)       -
                      1996   119,000       -         2,761 (1)       -


Joseph Murphy         1998  $93,767    $21,448      $2,344 (1)    $7,375(3)
Executive Vice        1997   89,302     44,155       2,233 (1)        -
President of Sales    1996   85,362     53,710       2,134 (1)        -
& Operations

(1) Company funded contributions to the Company's Simplified Pension Plan  
(SEP).

(2) Includes 125,000 shares of common stock awarded to Frank J. Carcione at 
a value of $.07375 per share.

(3) Includes 100,000 shares of common stock awarded to Joseph Murphy at a 
value of $.07375 per share.

       AGGREGATED OPTION EXERCISES IN THE LAST FISCAL YEAR
                         AND FY-END OPTION VALUES

                                                                  VALUE OF
                                               NUMBER OF        UNEXERCISED
                       SHARES                 UNEXERCISED      IN-THE-MONEY
NAME                  ACQUIRED                  OPTIONS           OPTIONS
                         ON        VALUE      EXERCISABLE/     EXERCISABLE/
                      EXERCISE   REALIZED    UNEXERCISABLE    UNEXERCISABLE 
  
Frank J. Carcione
CEO                      -           -             -                  -


Joseph M. Murphy         -           -         15,000            $1,725 (1)
                                           

(1) Value calculated based upon the average of the bid and ask price on 
such dates.

ITEM 11.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
 
      The following table sets forth, as of March 1, 1999, certain 
information with respect to each person who was known to the Company to be 
a beneficial owner of more than five percent (5%) of the Company's Common 
Stock.
            
                                AMOUNT AND NATURE
NAME AND ADDRESS OF               OF BENEFICIAL                PERCENT OF
 BENEFICIAL OWNER                   OWNERSHIP                   CLASS (1)

H.F (Gerry) Lenfest               67,931,746 (2)                87.6% (2)
200 Cresson Blvd.
Oaks, PA  19456-0989
Chairman of the Board and Director

(1) As of March 1, 1999, 24,194,500 shares of Common Stock were            
    outstanding.

(2) Includes 26,274,234 shares of Common Stock issuable upon conversion    
    of Preferred stock owned by Mr. Lenfest.  Includes Warrants to acquire 
    up to 29,915,160 additional shares of Common Stock.  Does not include  
    undeclared and unpaid dividends on the Preferred Stock for the period  
    ended December 31, 1998, which may be converted into shares of Common  
    Stock.  Does not include accrued but unpaid interest on the            
    subordinated $500,000 Note which may be converted into shares of Common 
    Stock.

SECURITY OWNERSHIP OF MANAGEMENT

      The following table sets forth, as of March 1, 1999, certain 
information with respect to the Common Stock beneficially owned by the 
directors and executive officers of the Company and by all directors and 
executive officers as a group.  The address of all directors and executive 
officers is c/o TelVue Corporation, 16000 Horizon Way, Suite 500, Mt. 
Laurel, NJ  08054. 

                                AMOUNT AND NATURE
NAME AND ADDRESS OF               OF BENEFICIAL                PERCENT OF
 BENEFICIAL OWNER                   OWNERSHIP                   CLASS (1)

H.F. (Gerry) Lenfest              67,931,746  (2)                87.6% (2)
Chairman of the Board
and Director

Frank Carcione                       125,000                       .5%
Chief Executive Officer,
President and Director                            

Joseph M. Murphy                     190,000  (3)                  .8%
Executive Vice President
of Sales and Operations and
Director

Donald L. Heller                      15,000                       .1%  
Director                              

Joseph DiJulio                         5,000                       .0%
Director

All Directors and                 68,446,546(2)(3)(4)            88.2%   
Officers as a Group
(7 Persons)

(1) As of March 1, 1999, 24,194,500 shares of Common Stock were            
    outstanding.

(2)  Includes 26,274,234 shares of Common Stock issuable upon conversion    
    of Preferred stock owned by Mr. Lenfest.  Includes Warrants to acquire 
    up to 29,915,160 additional shares of Common Stock.  Does not include  
    undeclared and unpaid dividends on the Preferred Stock for the period  
    ended December 31, 1998, which may be converted into shares of Common  
    Stock.  Does not include accrued but unpaid interest on the            
    subordinated $500,000 Note which may be converted into shares of Common 
    Stock.

(3) Includes 15,000 shares issuable to Joseph Murphy upon exercise of      
    currently exercisable stock options held by Mr. Murphy.

(4) Includes 3,000 shares issuable to Randy Gilson upon exercise of        
    currently exercisable stock options held by Mr. Gilson.


ITEM 12.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

      At December 31, 1998, the Company was indebted to Mr. Lenfest in the 
principal amount of $2,419,712.  Mr. Lenfest has agreed to accept payments 
at the rate of $150,000 per month. (See Management's Discussion and 
Analysis or Plan of Operation and Note 4 of the 1998 financial statements 
of the Company).

      The Company provided its ANI services to subsidiaries of Lenfest 
Communications, Inc. ("LCI"), a company operating under the control of Mr. 
Lenfest.  The Company recognized revenues of approximately $400,000 from 
LCI subsidiaries during 1998.  (See Note 9 of the 1998 financial statements 
of the Company).

     In 1998, the Company issued 375,000 shares of its common stock to four 
of its executives as a discretionary bonus.  All of these shares are fully 
vested (See Note 2 to the 1998 financial statements).

     Other related transactions are described in Notes 4, 6 and 9 of the 
1998 financial statements of the Company.

 
ITEM 13.    EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES & REPORTS ON         
              FORM 8-K

FINANCIAL STATEMENTS

      Report of Independent Certified Public Accountants dated February    
      2, 1999.

      Balance Sheets as of December 31, 1998 and 1997.

      Statements of Operations for the years ended December 31, 1998 and   
      1997.

      Statements of Stockholders' Deficit for the years ended December 31, 
      1998 and 1997.

      Statements of Cash Flows for the years ended December 31, 1998 and   
      1997.

      Notes to Financial Statements.

REPORT ON FORM 8-K.

      None.

<PAGE>

EXHIBITS

3.1    Certificate of Incorporation of the Company (incorporated by         
       reference to the Company's Registration Statement on Form S-8, dated 
       March 30, 1989 (the "Registration Statement")).

3.2    Bylaws of the Company (incorporated by reference to the Company's
       Registration Statement).

3.3    Certificate of Amendment of Certificate of Incorporation of the      
       Company, dated April 11, 1990 (incorporated by reference to the      
       Company's Annual Report on Form 10-K for the year ended December 31, 
       1991, (the "1991 Form 10-K")).

3.4    Certificate of Amendment of Certificate of Incorporation of the      
       Company, dated March 15, 1991 (incorporated by reference to the 1991 
       Form 10-K).

3.5    Form of copy of Amendment of Certificate of Incorporation of the     
       Company, filed September 25, 1995 (incorporated by reference to the  
       Company's Form 10-QSB for the period ended September 30, 1995, (the  
       September 30, 1995 Form 10-QSB)). 

4.1    Incentive Stock Option Plan (incorporated by reference to the        
       Company's Registration Statement).

4.2    Form of Stock Option Agreement (incorporated by reference to the     
       Company's Annual Report on Form 10-K for the year ended December 31, 
       1989, (the "1989 Form 10-K")).

4.3    Warrant Agreement, dated March 15, 1991, between the Company and     
       H.F. Lenfest (incorporated by reference to the Company's Annual      
       Report on Form 10-K for the year ended December 31, 1990, (the "1990 
       Form 10-K")).

4.4    Certificate of Designation of Class A Preferred Stock (incorporated  
       by reference to the September 30, 1990 Form 10-Q).

10.1   Distributorship Agreement, dated November 2, 1989, between the       
       Company and Science (incorporated by reference to the 1989 Form      
       10-K).

10.2   Stock Purchase Agreement, dated November 2, 1989, between the        
       Company and H.F. Lenfest (incorporated by reference to the Company's 
       Report on Form 8-K, dated November 15, 1989, (the "1989 Form 8-K")).

10.3   Shareholders' Agreement, dated November 2, 1989, among the Company   
       and certain of its stockholders (incorporated by reference to the    
       Company's 1989 Form 8-K).

10.4   Option Agreement, dated November 2, 1989, among the Company and      
       certain of its stockholders (incorporated by reference to the 1989   
       Form 8-K).

10.5   Form of Credit Agreement between the Company and H.F. Lenfest        
      (incorporated by reference to the 1990 Form 10-K).

10.7   Form of Line of Credit Agreement between the Company and H.F.        
       Lenfest (incorporated by reference to the 1990 Form 10-K).    
 
10.8   Subordinated Promissory Note, dated November 15, 1994 the principal  
       amount of $541,000 payable to Science Dynamics Corporation           
       (incorporated by reference to the 1994 Form 10-KSB).

10.10  Letter Agreement dated November 8, 1990 between Science Dynamics     
       Corporation and H.F. Lenfest (incorporated by reference to the       
       Company's Report on Form 8-K for November 16, 1990).

10.11  Loan Agreement dated December 24, 1991, between the Company and H.F. 
       Lenfest (incorporated by reference to the 1991 Form 10-K).

10.12  Lease Agreement for office space and the First Amendment to Lease    
       dated March 30, 1994, between the Company and Bloom Associates       
       (incorporated by reference to the 1994 Form 10-KSB).

10.13  Letter effective as of March 31, 1998, from H.F. Lenfest, waiving    
       the repayment of loans and accrued interest until January 1, 2000    
       (incorporated by reference to the March 31, 1998, Form 10-QSB).

11.    Statement re:  Computation of Per Share Earnings (see the Company's
       1998 Financial Statements included herein).


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.

                                                   TELVUE CORPORATION


DATED:   3/26/99                  By:   /s/Frank J. Carcione
                                        ----------------------------------
                                        Frank J. Carcione
                                        President (Chief Executive Officer)


DATED:   3/26/99                  By:   /s/Irene A. DeZwaan
                                        ----------------------------------
                                        Irene A. DeZwaan
                                        Treasurer (Controller)
                           

       Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
  
SIGNATURES                            TITLE                   DATE


--------------------------------    Chairman of the           
H.F. Lenfest                        Board and Director

/s/Frank J. Carcione                Director                  3/26/99
--------------------------------
Frank J. Carcione
  
/s/Donald Heller                    Director                  3/26/99
--------------------------------
Donald Heller    

/s/Joseph M. Murphy                 Director                  3/26/99
--------------------------------
Joseph Murphy

/s/J.A. DiJulio                     Director                  3/26/99      
--------------------------------
Joseph A. DiJulio

<PAGE>


TELVUE CORPORATION

FINANCIAL STATEMENTS

Years Ended December 31, 1998 and 1997



TABLE OF CONTENTS

                                                                   PAGE NO.
                                                                   --------

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

FINANCIAL STATEMENTS

      Balance Sheets  

      Statements of Operations  

      Statements of Stockholders' Deficit  

      Statements of Cash Flows

      Notes to Financial Statements  






REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS




To The Board of Directors and Stockholders
TelVue Corporation



We have audited the balance sheets of TelVue Corporation (a Delaware 
corporation) as of December 31, 1998 and 1997, and the related statements 
of operations, stockholders' deficit and cash flows for the years then 
ended.  These financial statements are the responsibility of the Company's 
management.  Our responsibility is to express an opinion on these financial 
statements 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 consolidated 
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 financial statements referred to above present fairly, 
in all material respects, the financial position of TelVue Corporation as 
of December 31, 1998 and 1997, and the results of its operations and its 
cash flows for the years then ended in conformity with generally accepted 
accounting principles.


February   2, 1999


<PAGE>

TELVUE CORPORATION
BALANCE SHEETS
December 31, 1998 and 1997

                                                   1998            1997
                                               -------------   ----------- 
[S]                                              [C]             [C]       
  
ASSETS                                         
        
CURRENT ASSETS
  Cash and cash equivalents                     $   453,569     $  445,368
  Accounts receivable - trade                       786,083        922,737
  Other receivables                                   4,910          5,281
  Deferred tax asset                                285,935        477,987
  Other current assets                               11,626         10,898
                                                -----------     ----------
     TOTAL CURRENT ASSETS                         1,542,123      1,862,271

PROPERTY AND EQUIPMENT                            4,791,240      4,534,168
  Less accumulated depreciation                   3,462,823      2,639,651
                                                -----------     ----------
                                                  1,328,417      1,894,517
OTHER ASSETS
 Deferred tax asset                               1,932,778      2,027,450
 Deposits                                             9,300          9,300 
                                                 -----------    ----------
                                                  1,942,078      2,036,750 
                                                 -----------    ----------
 
                                                 $4,812,618     $5,793,538
                                                 ===========    ==========

LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITIES
  Notes payable-majority stockholder-current    $ 1,380,000    $ 1,800,000
  Accounts payable                                  512,047        423,851
  Accrued expenses                                  172,839        192,305
  Accrued dividends payable                         422,244           -
  Income taxes payable                                8,661         12,000
  Deferred trunk credit                                -           164,200
                                                -----------     ----------
     TOTAL CURRENT LIABILITIES                    2,495,791      2,592,356

NOTES PAYABLE - MAJORITY STOCKHOLDER, net
of current portion                                1,039,712      2,519,712


ACCRUED INTEREST - MAJORITY STOCKHOLDER           2,694,837      2,187,721


REDEEMABLE CONVERTIBLE PREFERRED STOCK,
 $1 par value, 6,900,000 shares authorized,
 3,518,694 shares issued and outstanding at
 December 31, 1998 and 1997, (liquidation value
 $3,940,938 and $3,518,694, respectively)         3,518,694      3,518,694


COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' DEFICIT
  Common stock, $.01 par value, 100,000,000 
  shares authorized, 24,194,500 and 23,814,500   
  shares issued and outstanding at December
  31, 1998 and 1997, respectively                   241,945        238,145
  Additional paid-in capital                      1,550,535      1,516,335
  Accumulated deficit                            (6,728,896)    (6,779,425)
                                                 -----------    -----------
                                                 (4,936,416)    (5,024,945)
                                                 -----------    -----------
                                                 $4,812,618     $5,793,538
                                                 ===========    ===========
See accompanying notes

<PAGE>



TELVUE CORPORATION
STATEMENTS OF OPERATIONS
Years Ended December 31, 1998 and 1997

                                                     1998            1997
                                                     ----            ----
REVENUES                                       $ 6,122,249     $ 6,330,675
        
OPERATING EXPENSES
  Service                                        2,711,860       3,186,546
  Selling and marketing                            593,862         585,544
  General and administrative                       648,893         642,767
  Depreciation                                     870,095         831,609
                                               -----------     -----------
                                                 4,824,710       5,246,466
                                               -----------     -----------

OPERATING INCOME                                 1,297,539       1,084,209 

OTHER INCOME (EXPENSE)
  Interest income, net of reimbursement           (507,116)       (459,352)
  Interest income                                   24,165          42,221 
  Other income (expense)                           (33,430)        (24,881)
                                                -----------     -----------
                                                  (516,381)       (442,012)
                                                -----------     -----------

INCOME BEFORE INCOME TAXES                         781,158         642,197 

INCOME TAX BENEFIT (EXPENSE)                      (308,385)      2,493,437
                                                ------------    -----------

NET INCOME                                         472,773       3,135,634 
 

DIVIDENDS ON REDEEMABLE
  CONVERTIBLE PREFERRED STOCK                     (422,244)       (359,932)
                                                 -----------   ------------

NET INCOME AVAILABLE TO 
  COMMON STOCKHOLDERS                            $  50,529     $ 2,775,702 
                                                 ===========   ============

EARNINGS (LOSS) PER COMMON SHARE  
  BASIC                                          $       -     $       .12
                                                 ============  ============
  DILUTED                                        $     .01     $       .04
                                                 ============  ============ 
    
WEIGHTED AVERAGE NUMBER OF COMMON 
SHARES OUTSTANDING                               24,036,167      23,795,102
                                                 ==========      ==========


See accompanying notes.

<PAGE>

TELVUE CORPORATION
STATEMENTS OF STOCKHOLDERS' DEFICIT
Years Ended December 31, 1998 and 1997

                                      Additional                 Total
                             Common    Paid-In    Accumulated Stockholders'
                              Stock    Capital      Deficit      Deficit
                             -------  ----------  ----------- ------------- 
BALANCE, 
 DECEMBER 31, 1996          $237,945 $1,515,535  $(9,555,127)  $(7,801,647)

Accrued dividends on 
redeemable convertible
 preferred stock                  -           -     (359,932)     (359,932)
Issuance of 20,000 shares
 of common stock under
 director compensation plan     200         800            -         1,000
Net income                        -           -    3,135,634     3,135,634
                            -------  ----------  -----------   ----------- 
  
BALANCE, 
 DECEMBER 31, 1997          238,145   1,516,335   (6,779,425)   (5,024,945)

Accrued dividends on 
redeemable convertible
 preferred stock                  -           -     (422,244)     (422,244)
Issuance of 380,000 shares
 of common stock              3,800      34,200            -        38,000
Net income                        -           -      472,773       472,773
                           --------  ----------  -----------   ----------- 
BALANCE,
 DECEMBER 31, 1998         $241,945  $1,550,535  $(6,728,896)  $(4,936,416)
                           ========  ==========  ===========   ===========

See accompanying notes.

<PAGE>

TELVUE CORPORATION
STATEMENTS OF CASH FLOWS
Years Ended December 31, 1998 and 1997
                                                    1998          1997
                                                    ----          ---- 

CASH FLOWS FROM OPERATING ACTIVITIES 
  Net Income (loss)                             $  472,773    $ 3,135,634 
  Adjustments to reconcile net income (loss) to 
   net cash provided by operating activities
   Depreciation                                    870,095        831,609
   Loss on sales or disposal of property and
    equipment                                            -         24,881
   Deferred tax (benefit) expense                  286,725     (2,505,437)
   Issuance of common stock                         38,000          1,000
 Changes in assets and liabilities:
   Accounts receivable - trade and other           137,025        274,430
   Other current assets                               (728)         2,066 
   Deposits                                              -           (500) 
   Accounts payable - trade and other               88,196        104,877
   Accrued expenses                                (19,466)        27,429
   Income taxes payable                             (3,339)        12,000
   Deferred trunk credit                          (164,200)       (26,600)
   Accrued interest - majority stockholder         507,116        457,883
                                                 -----------    -----------
NET CASH PROVIDED BY OPERATING ACTIVITIES        2,212,197      2,339,272
                                                 -----------    -----------

CASH FLOWS FROM INVESTING ACTIVITIES 
  Purchases of property and equipment             (303,996)      (513,676)
  Proceeds from sales or disposal of
   property and equipment                                -          1,405
                                                 -----------    -----------
NET CASH (USED IN)INVESTING ACTIVITIES            (303,996)      (512,271)

CASH FLOWS FROM FINANCING ACTIVITIES
   Debt reduction:
    Notes payable - majority stockholder        (1,900,000)    (2,050,000)
                                                -----------    -----------
NET INCREASE (DECREASE) IN CASH AND
  CASH EQUIVALENTS                                   8,201       (222,999) 

CASH AND CASH EQUIVALENTS AT
  BEGINNING OF PERIOD                              445,368        668,367
                                                -----------    -----------
CASH AND CASH EQUIVALENTS AT END OF YEAR        $  453,569     $  445,368
                                                ===========    ===========





See accompanying notes.

<PAGE>

TELVUE CORPORATION 
NOTES TO FINANCIAL STATEMENTS
December 31, 1998 and 1997


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

This summary of significant accounting policies of TelVue Corporation 
("the Company") is presented to assist in understanding its financial 
statements.  These accounting policies conform to generally accepted 
accounting principles and have been consistently applied in the preparation 
of the financial statements.

BUSINESS ACTIVITY AND CONCENTRATION OF CREDIT RISK

The Company primarily provides automatic telephone number identification 
services to the cable television industry throughout the United States for 
the automated ordering of pay-per-view features and events. 

The Company grants credit to cable television operators throughout the 
nation.  Consequently, the Company's ability to collect the amounts due 
from customers is affected by economic fluctuations in the cable television 
industry.

The Company maintains cash balances at a financial institution located in 
the Philadelphia Area.  Accounts at this institution are insured by the 
Bank Insurance Fund up to $100,000.  The Company maintains cash balances in 
excess of the insured amount.

During 1998 and 1997, four customers accounted for 50% and 51% of sales, 
respectively, and 37% and 48% of receivables at December 31, 1998 and 1997, 
respectively. 

Currently, the Company's sole source of financing is the majority 
stockholder.  In the past, the Company has been unable to obtain funding 
from other third parties on terms that are acceptable to the Company.

USE OF ESTIMATES

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 
disclosure of contingent assets and liabilities at the date of the 
financial statements and reported amounts of revenues and expenses during 
the reporting period.  Actual results could differ from those estimates. 

CASH AND CASH EQUIVALENTS

For purposes of the statements of cash flows, the Company considers all 
short-term debt securities purchased with an original maturity of three (3) 
months or less to be cash equivalents.

ACCOUNTS RECEIVABLE - TRADE

The Company evaluates its accounts receivable on a customer by customer 
basis and has determined that no allowance for doubtful accounts is 
necessary at December 31, 1998 and 1997.  Historically, the Company has 
experienced virtually no bad debt.

PROPERTY AND EQUIPMENT

Property and equipment are stated at cost.  Depreciation and amortization 
are provided over five years using the straight-line method.  Property and 
equipment consists primarily of operating equipment.  For income tax 
purposes, recovery of capital costs for property and equipment is made 
using accelerated methods over statutory recovery periods.

Expenditures for renewals and betterments that extend the useful lives of 
property and equipment are capitalized. Expenditures for maintenance and 
repairs are charged to expense as incurred.

VALUATION OF LONG-LIVED ASSETS

In accordance with Statement of Financial Accounting Standards No. 121 
"Accounting for the Impairment of Long-Lived Assets to be Disposed of", 
the Company assesses, on an on-going basis, the recoverability of long-
lived assets based on estimates of future undiscounted cash flows for the 
applicable business acquired compared to net book value.  Long-lived assets 
include property and equipment.  If the future undiscounted cash flow 
estimate is less than net book value, net book value is then reduced to the 
fair value of the assets.  The Company also evaluates the depreciation 
periods of assets, to determine whether events or circumstances warrant 
revised estimates of useful lives.  As of December 31, 1998, management 
believes that no revisions to the remaining useful lives or writedowns of 
long-lived assets are required.

REVENUE RECOGNITION

The Company recognizes revenue in the month service is provided, net of an 
estimate for programs not billable by the cable television operator.

ADVERTISING

The Company follows the policy of charging the costs of advertising to 
expense as incurred.  Advertising expense is included in selling and 
marketing expense in the accompanying statements of operations.

EARNINGS (LOSS) PER COMMON SHARE

Basic earnings (loss) per common share is computed using the weighted 
average number of shares of outstanding.  Diluted earnings (loss) per 
common share is computed using the weighted average number of shares 
outstanding adjusted to include incremental common shares that would have 
been outstanding if potentially dilutive common shares had been issued.  
Incremental shares of 57,027,826 and 53,497,636 in 1998 and 1997, 
respectively, were used in the calculation of diluted earnings (loss) per 
common share.

NOTE 2 - SUPPLEMENTARY DISCLOSURES TO STATEMENTS OF CASH FLOWS

Cash paid during the year for:
                                                   1998        1997
                                                   ----        ----
Interest                                        $   -       $   -

Income taxes                                    $ 25,000    $   -


NONCASH INVESTING AND FINANCING TRANSACTIONS

The Company accrued dividends on its redeemable convertible preferred stock 
of $422,244 and $359,932 in 1998 and 1997, respectively.  In 1998 and 1997, 
the Company issued 5,000 and 20,000 shares of common stock valued at $500 
and $1,000, respectively under the Director Compensation Plan (See Note 6). 
In 1998, the Company issued 375,000 shares of common stock valued at 
$37,500 to four key employees.  In 1997, the Company issued 359,932 shares 
of redeemable convertible preferred stock in payment of both semi-annual 
1997 dividends.  In 1997, the Company issued 173,126 shares, of redeemable 
convertible preferred stock in payment of interest on a line of credit.

NOTE 3 - PROPERTY AND EQUIPMENT

The schedule of property and equipment at December 31, 1998 and 1997, is as 
follows:

                                                               Estimated
                                                             Useful Lives
                                        1998        1997       in Years
                                        ----        ----     ------------
Operating equipment                  $4,549,957  $4,250,971       5
Office furniture and equipment          201,599     243,513       5
Leasehold improvements                   39,684      39,684       5
                                     ----------  ----------
                                     $4,791,240  $4,534,168
                                     ==========  ==========

NOTE 4 - NOTES PAYABLE - MAJORITY STOCKHOLDER

Notes payable to the majority stockholder consisted of the following at 
December 31, 1998 and 1997:

                                                    1998           1997
                                                    ----           ----

National equipment loan (a)                      $1,471,272    $1,471,272
Additional lines of credit (b)                      407,440     2,307,440
Notes payable (SDC) (c)                             541,000       541,000
                                                 ----------    ----------
                                                 $2,419,712    $4,319,712
                                                 ==========    ==========

(a)  In March 1994, the Company's majority stockholder provided a 1,500,000 
line of credit for the purchase of additional equipment to expand the 
National POP (Point of Presence).  Amounts outstanding bear interest at 
prime plus one percent (1%) and interest is payable quarterly.  At the 
option of the Company, interest may be paid by the delivery of shares of 
Redeemable Convertible Preferred Stock (see Note 6) at $1 per share.  In 
1997, the Company issued 173,126 shares of redeemable convertible preferred 
stock in payment of interest.  The effective interest rates, at December 
31, 1998 and 1997, were 8.75% and 9.5%, respectively.

(b)  The Company's majority stockholder has provided several additional 
lines of credit.  Borrowings under all of these lines of credit bear 
interest at prime plus one percent (1%).  The effective interest rates, at 
December 31, 1998 and 1997, were 8.75% and 9.5%, respectively.  The 
availability of additional funding may be terminated at any time if the 
majority stockholder determines that there is no reasonable prospect that 
the Company will be able to achieve net income on a consistent basis.

(c)  In January 1995, the Company's majority stockholder acquired from 
Science Dynamics Corporation ("SDC") a subordinated note in the amount of 
$541,000.  The note is noninterest-bearing and repayment is restricted to 
cash not needed for operations as determined by the Company.

The Company has obtained from the majority stockholder an extension of a 
prior agreement whereby the majority stockholder has agreed not to demand 
repayment of principal or interest during 1999.  However, the Company has 
decided to voluntarily make, and the majority stockholder has agreed to 
accept, monthly payments against the loan principal in the amount of 
$115,000.  The Company, at its discretion, may make monthly principal 
payments in excess of $115,000 when the Company has excess cash not needed 
to fund operations.  The Company has, therefore, classified $1,380,000 of 
the notes payable to the majority stockholder as a short term liability and 
has classified the balance of the notes payable and the accrued interest as 
long-term liabilities.

NOTE 5 - LEASES

The Company leases office facilities and trunk lines and data circuits.  
Future minimum lease payments under non-cancelable operating leases 
consisted of the following:

            Year Ending               Operating
            December 31,                Lease
            -----------              ----------
               1999                   $ 49,117

Rental expense under the operating lease for office facilities amounted to 
$97,798 for each of the years ended December 31, 1998 and 1997.

In connection with the lease of its trunk lines, the Company received 
credits of which $164,200 was not yet earned by the Company as of December 
31, 1997. 

It is expected that, in the normal course of business, expiring leases will 
be renewed or replaced by leases on other properties; thus, it is 
anticipated that future minimum operating lease commitments will not be 
less than the amount shown for 1999.

NOTE 6 - CAPITAL STOCK

COMMON STOCK VOTING RIGHTS AND CONCENTRATION OF CONTROL

Shares of Common Stock which have had the same beneficial owner since April 
21, 1988, or which have had the same beneficial owner for a continuous 
period in excess of 2 years prior to the record date of any meeting of 
stockholders, will be entitled to 10 votes per share in any matters 
submitted for vote, at a meeting of stockholders.  All other stockholders 
have one vote per share unless this limitation is waived by the Board of 
Directors.

In November 1989, the Company issued 12,896,968 shares of Common Stock for 
$1,250,000 to an individual who effectively acquired control of the 
Company.  In connection with this sale, the Board of Directors waived the 
waiting period for these shares of Common Stock related to full voting 
rights described above.  In January 1995, this individual acquired an 
additional 1,660,485 shares of common stock of the Company from SDC.

REDEEMABLE CONVERTIBLE PREFERRED STOCK

In April 1990, the Company issued 1,250,000 shares of Class A Redeemable 
Convertible Preferred Stock (Preferred Stock) for $1,250,000.  The 
Preferred Stock has a par value of $1 per share and pays a cumulative $.06 
semiannual dividend.  The dividend is payable in cash or additional shares 
of Preferred Stock at $1 per share, at the option of the Company.  Each 
share of Preferred Stock is convertible into 6.667 shares of Common Stock 
at any time, at the option of the holder.  The Preferred Stock has a 
preference of $1 per share plus unpaid dividends in the event of 
liquidation.  In December 1997, the 1997 semiannual dividends were declared 
and paid with 359,932 shares of Preferred Stock.

The Company may redeem the Preferred Stock at any time for $2 per share.  
The stockholder of the Preferred Stock is the majority stockholder.  The 
majority stockholder can designate all of the Company's directors and, 
therefore, could influence the Company's willingness to cause a redemption 
of the Preferred Stock.  As a result, the Preferred Stock has been 
classified outside of the stockholders' deficit section of the accompanying 
balance sheets.

DIRECTOR COMPENSATION PLAN

In December 1997, the Company adopted a Director Compensation Plan.  Under 
this plan, each non-employee director, other than the majority stockholder, 
is compensated $500 for each meeting attended by receiving shares of Common 
Stock issued at the higher of the per share fair market value of the Common 
Stock as of the board of directors meeting date or $.05 per share.  In 1998 
and 1997, the Company issued 5,000 and 20,000 shares of Common Stock under 
this plan, respectively, and recognized director compensation expense of 
$500 and $1,000, respectively.

COMMON STOCK WARRANTS

In connection with one of the lines of credit discussed in Note 4, the 
Company agreed to issue warrants to the majority stockholder to purchase 
29,915,160 shares of the Company's Common Stock for $.01 per share, the 
fair market value of the Common Stock on the grant date.  The warrants 
provide for adjustments of the exercise price and the number of shares 
issuable thereunder in the event that the Company issues additional shares 
of Common Stock and other events as defined in the warrant agreement.  The 
warrant holder is entitled, at the Company's expense, to certain 
registration rights under the Securities Act of 1933 in connection with any 
shares of the Company's Common Stock issued pursuant to exercise of the 
warrants.

NOTE 7 - CORPORATE INCOME TAXES

The Company uses the asset and liability method of accounting for income 
taxes in accordance with Financial Accounting Standards Board Statement 
(SFAS) No. 109, "Accounting for Income Taxes".  SFAS 109 requires 
recognition of deferred tax assets and liabilities for the expected future 
tax consequences of events that have been recognized in the financial 
statements or tax returns.  Under this method, deferred tax liabilities and 
assets are determined based on the differences between the financial 
statement carrying amounts and tax bases of assets and liabilities using 
enacted tax rates in effect in the years in which the differences are 
expected to reverse.  Differences between financial reporting and tax bases 
arise most frequently from differences in timing of income and expense 
recognition.  Deferred income tax expense is measured by the change in the 
net deferred income tax asset or liability during the year.

The provisions for income tax benefit (expense) consist of the following 
components:


                                                    1998          1997
                                                -----------   -----------
Current
  Federal (alternative minimum tax)             $(21,660)    $  (12,000)
  State                                                -              -
                                                ---------    -----------
                                                 (21,660)       (12,000)
Deferred
  Federal                                       (264,994)      (208,368)
  State                                          (73,844)       (60,763)
                                                ---------    ----------
                                                (338,838)      (269,131)
  Valuation allowance (increase) decrease         52,113      2,774,568
                                                ---------    ----------
                                                (286,725)     2,505,437
                                                ---------    ----------

                                                $(308,385)   $2,493,437
                                                ==========   ==========

The categories of temporary differences that give rise to deferred tax 
assets and liabilities are as follows:

                                        Federal                State   
                                    ---------------        --------------
                                    1998       1997        1998      1997
                                    ----       ----        ----      ----
Deferred Tax Assets:
  Accrued interest - 
   stockholder                  $  830,347  $  674,092  $252,641  $205,099
                                ----------  ----------  --------  --------

  Net operating loss
   carryforward                  1,215,281   1,716,879   190,321   329,764
  Alternative minimum tax
   credit                           33,000      12,000         -         -
                                ----------  ----------  --------  --------
Gross Deferred Tax Asset         2,078,628   2,402,971   442,962   534,863

Deferred Tax Liabilities:
 Property and equipment,
   principally due to differences
   in depreciation                 (86,299)   (145,648)  (26,257)  (44,315)
                                ----------   --------- ---------  --------
  Net deferred tax asset before	
   valuation allowance           1,992,329   2,257,323   416,705   490,548
  Valuation allowance                    -           -  (190,321) (242,434)
                                ----------  ----------- --------   --------
Net Deferred Tax Asset           1,992,329  $2,257,323  $226,384  $248,114
                                 =========  ==========  ========  ========

The Company has a net operating loss carryforward of approximately 
$3,600,000 on a tax reporting basis.  The carryforward will begin to expire 
in 2004, if not utilized.  The Company also has an alternative minimum tax 
credit carryforward of approximately $33,000.  This carryforward has no 
expiration date.

Differences between the effective income tax rate and the statutory federal 
income tax rate were primarily the result of the change in the valuation 
allowance.

NOTE 8 - PENSION PLAN

The Company maintains a Simplified Employee Pension (SEP) plan under 
section 408(k) of the Internal Revenue Code for all eligible employees.  
Employees are eligible to participate if they are at least 21 years old and 
have been employed by the Company for at least 90 days.  Under the plan, 
employees may elect to defer up to 15% of their salary, subject to Internal 
Revenue Service limits.  The Company may make discretionary contributions 
for the participants.  The Company elected to match fifty percent (50%) of 
1998 and 1997 contributions by participating eligible employees up to five 
percent (5%) of their salary, for a maximum contribution of 2.5% of salary. 
The Company's contributions for 1998 and 1997 amounted to $21,223 and 
$19,930, respectively.

NOTE 9 - RELATED PARTY TRANSACTIONS

The Company has several notes payable to the majority stockholder.  (See 
Note 4).

The Company provided its automated number identification services to 
subsidiaries of Lenfest Communications, Inc. ("LCI").  The Company 
recognized revenues of approximately $400,000 and $470,000 from LCI 
subsidiaries in 1998 and 1997, respectively and had a receivable of $59,848 
and $65,916 due from LCI at December 31, 1998 and 1997, respectively.  
These services were provided at normal billing rates.  The Company and LCI 
are under the control of the majority stockholder of the Company.

NOTE 10 - FAIR VALUE OF FINANCIAL INSTRUMENTS 

The following methods and assumptions were used to estimate the fair value 
of each class of financial instruments for which it is practicable to 
estimate that value:

Cash and Cash Equivalents, Receivables, Accounts Payable and Accrued 
Expenses.

The carrying amount approximates fair market value because of the short 
maturity of those instruments

Long-term Debt and Accrued Interest

Due to  the related party nature, it is uncertain at what rate the Company 
could borrow funds from an unrelated party, if at all.  Therefore, it is 
not practical to estimate the fair market value of the long-term debt and 
accrued interest.

NOTE 11 - COMMITMENTS AND CONTINGENCIES

The Company has received notice from a cable operating company customer 
alerting its right to be indemnified against claims of patent infringement 
made to the cable operator by a third party.  The third party has alleged 
to the cable operator that portions of the cable operator's pay-per-view 
operations infringe one or more patents held by such party.  No notice of 
alleged infringement has been received by the Company from such third 
party.  The Company has retained independent patent counsel to review the 
third party patents and the alleged infringement.  The Company is unable at 
this time to determine if it has liability under the indemnity provisions 
of the contracts with the cable operator or the amount of such liability if 
it exists.