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                                    FORM 10-K
                         ------------------------------
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
              (Mark One)

               [X]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                    SECURITIES EXCHANGE ACT OF 1934
                    FOR THE FISCAL YEAR ENDED
                                DECEMBER 31, 1998
                                       OR
               [ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                    SECURITIES EXCHANGE ACT OF 1934
                    FOR THE TRANSITION PERIOD FROM  ___________ TO ____________

                        Commission file number 333-30745

                       COMCAST CABLE COMMUNICATIONS, INC.
             (Exact name of registrant as specified in its charter)


                     DELAWARE                           23-2175755
    (State or other jurisdiction of       (I.R.S. Employer Identification No.)
     incorporation or organization)  

  1201 Market Street, Suite 2201 Wilmington, Delaware          19801
       (Address of principal executive offices)             (Zip Code)

       Registrant's telephone number, including area code: (302) 594-8700
                        --------------------------------

           SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
                                      NONE
                          ----------------------------

           SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
                                      NONE
                          ----------------------------

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  Registrant  was
required  to file  such  reports)  and  (2)  has  been  subject  to such  filing
requirements for the past 90 days.
               Yes _X_                                 No ___
                           --------------------------

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

As of December 31, 1998, there were 1,000 shares of Common Stock outstanding.

                           --------------------------

The Registrant  meets the conditions set forth in General  Instructions  I(1)(a)
and (b) of Form  10-K  and is  therefore  filing  this  form  with  the  reduced
disclosure format.

                           --------------------------

                       DOCUMENTS INCORPORATED BY REFERENCE
                                      NONE

                           --------------------------

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<PAGE>
                       COMCAST CABLE COMMUNICATIONS, INC.
                          1998 FORM 10-K ANNUAL REPORT

                                TABLE OF CONTENTS
                                     PART I
Item 1   Business.............................................................1
Item 2   Properties..........................................................12
Item 3   Legal Proceedings...................................................12
Item 4   Submission of Matters to a Vote of Security Holders.................12

                                     PART II

Item 5   Market for the Registrant's Common Equity 
          and Related Stockholder Matters....................................13
Item 6   Selected Financial Data.............................................13
Item 7   Management's Discussion and Analysis of Financial 
          Condition and Results of Operations................................14
Item 8   Financial Statements and Supplementary Data.........................19
Item 9   Changes in and Disagreements with Accountants on 
          Accounting and Financial Disclosure................................36

                                    PART III
Item 10  Directors and Executive Officers of the Registrant..................36
Item 11  Executive Compensation..............................................36
Item 12  Security Ownership of Certain Beneficial Owners and Management......36
Item 13  Certain Relationships and Related Transactions......................36

                                     PART IV

Item 14  Exhibits, Financial Statement Schedules and 
          Reports on Form 8-K................................................37
SIGNATURES...................................................................39

                           --------------------------

     This Annual  Report on Form 10-K is for the year ending  December 31, 1998.
This Annual Report modifies and supersedes  documents filed prior to this Annual
Report. The SEC allows us to "incorporate by reference" information that we file
with them,  which means that we can  disclose  important  information  to you by
referring you directly to those documents. Information incorporated by reference
is considered to be part of this Annual Report. In addition, information we file
with the SEC in the future will automatically  update and supersede  information
contained in this Annual Report.  In this Annual Report,  "Comcast Cable," "we,"
"us" and "our" refer to Comcast Cable Communications, Inc. and its subsidiaries.

     You  should  carefully  review the  information  contained  in this  Annual
Report, but should  particularly  consider any risk factors we set forth in this
Annual Report and in other  reports or documents  that we file from time to time
with the SEC. In this Annual  Report,  we state our beliefs of future events and
of our future  financial  performance.  In some cases,  you can  identify  those
so-called "forward-looking statements" by words such as "may," "will," "should,"
"expects,"  "plans,"   "anticipates,"   "believes,"   "estimates,"   "predicts,"
"potential,"  or "continue" or the negative of those words and other  comparable
words.  You  should be aware  that those  statements  are only our  predictions.
Actual events or results may differ materially.  In evaluating those statements,
you should specifically  consider various factors,  including the risks outlined
below.  Those factors may cause our actual results to differ materially from any
of our forward-looking statements.

Factors Affecting Future Operations

     The cable communications industry may be affected by, among other things:

     o    changes in laws and regulations,
     o    changes in the competitive environment,
     o    changes in technology,
     o    franchise related matters,
     o    market  conditions that may adversely  affect the availability of debt
          and equity  financing for working  capital,  capital  expenditures  or
          other purposes; and
     o    general economic conditions.
<PAGE>
                                     PART I

ITEM 1    BUSINESS

     We are  principally  engaged in developing,  managing and operating  hybrid
fiber-coaxial  broadband  cable  communications  networks.  We are currently the
fourth-largest cable communications system operator in the United States and are
in the process of  implementing  high-speed  Internet access service and digital
video applications to enhance the products available on our cable networks.

     Our  consolidated   cable  operations  served   approximately  4.5  million
subscribers and passed  approximately  7.4 million homes in the United States as
of December 31, 1998. We own interests in other cable  communications  companies
serving more than 237,000  subscribers.  We expect to complete  transactions  in
1999 that will give us an ownership  and  management  interest in cable  systems
which, upon closing of certain pending  transactions,  will serve  approximately
1.0 million subscribers.

     We are a wholly owned subsidary of Comcast  Corporation.  We are a Delaware
corporation that was organized in 1981. We have our principal  executive offices
at 1201 Market Street,  Suite 2201,  Wilmington,  Delaware 19801.  Our telephone
number   is  (302)   594-8700.   We  also   have  a  world   wide  web  site  at
http://www.comcast.com.   The  information   posted  on  our  web  site  is  not
incorporated into this Annual Report.

                      GENERAL DEVELOPMENTS OF OUR BUSINESS

     We  entered  into  certain  significant   transactions  in  1998.  We  have
summarized these  transactions below and have more fully described them in Notes
3 and 4 to our  consolidated  financial  statements  in  Item 8 of  this  Annual
Report.

     Senior Notes Offering

     In November 1998, we sold $800 million aggregate  principal amount of 6.20%
senior  notes due 2008 in a public  offering.  Interest  on the notes is payable
semi-annually  on May 15 and November 15 of each year,  commencing May 15, 1999.
The notes are not redeemable prior to maturity. We used substantially all of the
net proceeds from the offering to repay existing intercompany borrowings and for
general corporate purposes.

     Acquisition of Jones Intercable

     In May and  August  1998,  we  announced  agreements  to  purchase  certain
interests in Jones Intercable,  Inc., for $700 million.  We expect to close this
acquisition in the first half of 1999 if we receive all the necessary regulatory
and  other  approvals.  Upon  completion  of  this  acquisition,   we  will  own
approximately 12.8 million shares of Jones Intercable's Class A common stock and
2.9  million   shares  of  its  common  stock.   Those  shares  will   represent
approximately  37% of the  economic  and 47% of the  voting  interest  in  Jones
Intercable. In addition, the 2.9 million shares of common stock that we will own
will represent approximately 57% of the outstanding common stock and will enable
us to elect  75% of the Board of  Directors  of Jones  Intercable.  We expect to
consolidate  Jones  Intercable in our financial  statements  upon closing of the
acquisition.

                          DESCRIPTION OF OUR BUSINESS

     Technology and Capital Improvements

     Our  broadband  cable  networks  receive  signals  by means  of: 

     o    special antennae,

     o    microwave relay systems,

     o    earth stations.

     These networks distribute a variety of video,  telecommunications  and data
services to residential and commercial subscribers.

     In accordance with the October 1997 "social  contract" we entered into with
the FCC, 80% of our cable subscribers will be served by a system with a capacity
of at least 550-MHz and at least 60% of our cable  subscribers will be served by
a system with a capacity of at least 750-MHz by March 31, 1999. In addition,  we
will provide free cable service  connections,  cable modems and modem service to
schools and to 250 public libraries in communities  when we commercially  deploy
cable modem service to residential customers in those communities.

     In addition to meeting our "social contract" commitments,  we are deploying
fiber optic cable and upgrading the technical quality of our broadband networks.
As a result,  the reliability and capacity of our systems has increased,  aiding
in the delivery of  additional  video  programming  and other  services  such as
enhanced  digital video,  high-speed  Internet access service and,  potentially,
telephony.  During 1998, we introduced our digital converter cable service in 10
markets. As of

<PAGE>

December 31, 1998,  approximately  78,000 subscribers were receiving our digital
service. Digital converter cable service allows us to use digital compression to
increase the channel capacity of our cable  communications  systems to more than
100 channels, as well as to improve picture quality.

     Franchises

     Cable   communications   systems  are   constructed   and  operated   under
non-exclusive  franchises granted by state or local governmental authorities and
are subject to federal,  state and local legislation and regulation.  Franchises
typically contain many conditions which may include:

     o    rate and service conditions,

     o    construction schedules,

     o    types of  programming  and  provision of services to schools and other
          public institutions,

     o    insurance and indemnity bond requirements.

     Our  franchises   typically   provide  for  periodic  payment  of  fees  to
franchising  authorities of up to 5% of "revenues" (as defined by each franchise
agreement).  We normally pass those fees on to  subscribers.  In most cases,  we
need the consent of the franchising  authority to transfer our  franchises.  The
franchises are granted for varying lengths of time.

     Although  franchises  historically have been renewed,  renewals may include
less  favorable  terms and  conditions.  Under existing law,  franchises  should
continue to be renewed for  companies  that have provided  adequate  service and
have complied  generally with franchise  terms.  The  franchising  authority may
choose to award  additional  franchises  to competing  companies at any time. We
have approximately 825 franchises in the United States.

     Revenue Sources

     We  receive  the  majority  of our  revenues  from  subscription  services.
Subscribers  typically  pay on a monthly  basis and  generally  may  discontinue
services  at any time.  Monthly  subscription  rates and  related  charges  vary
according  to the type of service  selected  and the type of  equipment  used by
subscribers.  Packages  of  channels  offered  to  subscribers  may  consist  of
television signals of:

     o    national television networks,

     o    local and distant  independent,  specialty and educational  television
          stations,

     o    satellite-delivered programming,

     o    locally originated programs,

     o    audio programming,

     o    electronic retailing programs.

     We also offer, for an additional monthly fee, one or more premium services,
such as:

     o    Home Box Office(R),

     o    Cinemax(R),

     o    Showtime(R),

     o    The Movie Channel(TM),

     o    Encore(R).

     These premium services generally offer,  without  commercial  interruption,
feature  motion  pictures,  live and taped sporting  events,  concerts and other
special  features.  The charge for premium  services  depends  upon the type and
level of service selected by the subscriber.

     We also generate revenues from advertising  sales,  pay-per-view  services,
installation services, commissions from electronic retailing and other services.
Pay-per-view  services  permit  a  subscriber  to  order,  for a  separate  fee,
individual  feature  motion  pictures  and  special  event  programs,   such  as
professional  boxing,  professional  wrestling  and  concerts.  We also generate
revenues  from the sale of  advertising  time to local,  regional  and  national
advertisers on non-broadcast channels.

     In December 1996, we began marketing @Home  Corporation's  high-speed cable
modem services in areas served by certain of our cable  communications  systems.
Residential subscribers can connect their personal computers via cable modems to
a high-speed  national network  developed and managed by @Home.  Subscribers can
then access online  information,  including the Internet,  at faster speeds than
that of  conventional or Integrated  Service  Digital  Network  modems.  Through
@Home, we provide businesses with Internet connectivity  solutions and networked
business  applications.  We and @Home  aggregate  content,  sell  advertising to
businesses and provide services to residential  subscribers.  As of December 31,
1998,  the Comcast @Home service was available to over 1.8 million homes in nine
markets and served more than 51,000 customers.

     Our sales efforts are primarily directed toward increasing  penetration and
generating  incremental  revenues  in our  franchise  areas.  We sell our  cable
communications services through:

     o    telemarketing,

     o    direct mail advertising,

                                      - 2 -
<PAGE>
     o    door-to-door selling,

     o    local media advertising.

     Programming

     We  generally  pay either a monthly  fee per  subscriber  per  channel or a
percentage  of certain  revenues  for  programming.  Our  programming  costs are
increased by:

     o    increases in the number of subscribers,

     o    expansion of the number of channels provided to customers,

     o    increases in contract rates from programming suppliers.

     We attempt to secure long-term  programming contracts with volume discounts
and/or  marketing  support  and  incentives  from  programming  suppliers.   Our
programming  contracts  are generally for a fixed period of time and are subject
to negotiated  renewal.  We anticipate that future contract renewals will result
in  programming  costs that are higher than our costs  today,  particularly  for
sports programming.

     Customer Service

     We are currently  consolidating our local customer service  operations into
large regional call centers.  These  regional call centers have  technologically
advanced  telephone  systems that provide  24-hour per day,  7-day per week call
answering  capability,  telemarketing  and  other  services.  Because  of  these
technological advances, we can better serve our subscriber base and cross-market
new products and  services.  We have 10 call centers in operation as of December
31, 1998 which serve approximately 2.4 million  subscribers.  Subscribers in our
remaining cable systems receive  customer service  primarily  through our local,
system-based representatives.

     Our Cable Systems

     The table  below  summarizes  Homes  Passed,  Cable  Subscribers  and Cable
Penetration  information for our cable communications  systems as of December 31
(homes and subscribers in thousands):

<TABLE>
<CAPTION>
                                                          1998          1997          1996(5)        1995           1994
                                                        ---------     ---------      ----------    ---------      --------
<S>                                                      <C>           <C>             <C>          <C>            <C>  
Homes Passed (1)(4)..................................     7,382         7,138           6,975        5,570          5,491
Cable Subscribers (2)(4).............................     4,511         4,366           4,280        3,407          3,307
Cable Penetration (3)(4).............................     61.1%         61.2%           61.4%        61.2%          60.2%
-------------------
<FN>
(1)  A home is "passed" if we can connect it to our distribution  system without
     further extending the transmission lines.
(2)  A dwelling with one or more television sets connected to a system counts as
     one Cable Subscriber.
(3)  Cable  Penetration means the number of Cable Subscribers as a percentage of
     Homes Passed.
(4)  The  information  consists  of cable  systems  whose  financial  results we
     consolidate.  The  information  does not include  341,000  Homes Passed and
     237,000 Cable Subscribers in non-consolidated  cable communications systems
     in which we have ownership and management  interests.  The information also
     does not include  pending  acquisitions  (see "General  Developments of Our
     Business").
(5)  In November  1996,  we acquired the cable  operations  of The E.W.  Scripps
     Company.
</FN>
</TABLE>

                           ---------------------------

                                      - 3 -

<PAGE>
     System Clusters

     We manage  most of our cable  systems in  geographic  clusters.  Clustering
permits us to deliver customer service and support in a more uniform,  efficient
and cost effective  manner.  The following table summarizes Homes Passed,  Cable
Subscribers and Cable  Penetration for our eight largest regional cable clusters
as of December 31, 1998 (homes and subscribers in thousands):
<TABLE>
<CAPTION>
                                                        Homes               Cable             Cable
Geographic Cluster                                     Passed            Subscribers       Penetration
---------------------------                          -----------         -----------       -----------
<S>                                                      <C>                 <C>                 <C>  
Mid-Atlantic.........................................    2,147.9             1,409.4             65.6%
Michigan.............................................      978.5               480.7             49.1%
Tennessee............................................      499.2               326.3             65.4%
Southern California..................................      517.2               271.4             52.5%
West Florida.........................................      413.4               269.9             65.3%
Sacramento...........................................      464.1               247.9             53.4%
Southeast Florida....................................      452.1               236.4             52.3%
Indianapolis.........................................      243.5               147.4             60.5%
                                                     -----------         ----------- 
                                                         5,715.9             3,389.4             59.3%
Other Systems........................................    1,666.0             1,121.3             67.3%
                                                     -----------         -----------
Total................................................    7,381.9             4,510.7             61.1%
                                                     ===========         ===========
</TABLE>
                           ---------------------------

     Competition

     Our cable communications systems compete with a number of different sources
which provide news,  information  and  entertainment  programming  to consumers,
including:

     o    local television  broadcast stations that provide off-air  programming
          which can be received using a roof-top antenna and television set,

     o    program  distributors that transmit satellite signals containing video
          programming, data and other information to receiving dishes of varying
          sizes located on the subscriber's premises,

     o    satellite master antenna television systems,  commonly known as SMATV,
          which generally serve condominiums, apartment and office complexes and
          residential developments,

     o    multichannel,  multipoint  distribution  service  operators,  commonly
          known  as  MMDS or  wireless  cable  operators,  which  use  low-power
          microwave   frequencies  to  transmit  video   programming  and  other
          information over-the-air to subscribers,

     o    other cable  operators who build and operate cable systems in the same
          communities that we serve, commonly known as overbuilders,

     o    interactive online computer services,

     o    newspapers, magazines and book stores,

     o    movie theaters,

     o    live concerts and sporting events,

     o    home video products, including videotape cassette recorders.

     Our cable  communications  systems will be competitive if we provide,  at a
reasonable  price  to  subscribers,  superior  technical  performance,  superior
customer  service  and  a  greater  variety  of  video   programming  and  other
communications services than are available from our competitors.

     Modifications to federal law in 1996 changed the regulatory  environment in
which our cable  communications  systems  operate.  Federal law now allows local
telephone  companies  to  provide  directly  to  subscribers  a wide  variety of
services that are competitive with our cable communications services. Some local
telephone companies:

     o    provide  video  services  within and outside their  telephone  service
          areas  through  a  variety  of  methods,   including  broadband  cable
          networks,  satellite  program  distribution and wireless  transmission
          facilities,

     o    have  announced  plans to construct and operate  cable  communications
          systems in various states.

     A local telephone company,  Ameritech,  has obtained approximately 14 cable
franchises in communities in Michigan that we also serve.  It competes  directly
with us in these areas by  providing  video and other  broadband  communications
services  to  subscribers.   New   facilities-based   competitors  such  as  RCN
Corporation  and  Knology  Holdings,  Inc.  are now  offering  cable and related
communications services in several areas where we hold franchises.

                                      - 4 -
<PAGE>

     Local  telephone  companies  and other  businesses  construct  and  operate
communications  facilities  that provide  access to the Internet and  distribute
interactive  computer-based services, data and other non-video services to homes
and businesses. These competitors are not required, in certain circumstances, to
comply with some of the  material  obligations  imposed  upon our cable  systems
under our  franchises.  We cannot predict the likelihood of success of competing
video or  broadband  service  ventures  by local  telephone  companies  or other
businesses.  Nor can we predict the impact of these competitive  ventures on our
cable communications systems.

     We  operate  each  of  our  cable  communications  systems  pursuant  to  a
non-exclusive franchise that is issued by the community's governing body such as
a city council,  a county board of  supervisors  or a state  regulatory  agency.
Federal law prohibits franchising authorities from unreasonably denying requests
for additional  franchises,  and it permits  franchising  authorities to operate
cable systems. Companies that traditionally have not provided cable services and
that have  substantial  financial  resources (such as public  utilities that own
certain of the poles to which our cables are  attached)  may also  obtain  cable
franchises and may provide competing communications services.

     In the past few years,  Congress  has enacted  legislation  and the FCC has
adopted  regulatory  policies  intended  to provide a more  favorable  operating
environment  for  existing  and new  technologies  that  provide,  or  have  the
potential to provide,  substantial  competition to cable communications systems.
These technologies include direct broadcast satellite service, commonly known as
DBS,  among  others.  According  to  recent  government  and  industry  reports,
conventional,   medium  and  high-power   satellites   currently  provide  video
programming to over 10.6 million individual households,  condominiums, apartment
and office  complexes  in the  United  States.  DBS  providers  with  medium and
high-power  satellites  typically  offer  to  their  subscribers  more  than 150
channels of programming, including program services similar to those provided by
cable systems.

     DBS systems use video  compression  technology to increase channel capacity
and digital  technology  to improve the  quality of the signals  transmitted  to
their subscribers.  DBS service currently has certain competitive advantages and
disadvantages compared to cable service.  Advantages of DBS service include more
programming,  greater  channel  capacity  and the  digital  quality  of  signals
delivered to  subscribers.  The  disadvantages  of DBS service  include high up-
front customer  equipment and installation costs and a lack of local programming
and local service.

     Two major  companies  are  currently  offering  nationwide  high-power  DBS
services.  Both companies have recently announced separate transactions that, if
completed,  may  significantly  enhance the number of channels on which they can
provide   programming  to  subscribers  and  may  improve   significantly  their
competitive  positions  against  cable  operators.  We are unable to predict the
effect these transactions may have on our business and operations.

     Our cable systems also compete for  subscribers  with SMATV systems.  SMATV
systems  typically are not subject to  regulation  like local  franchised  cable
operators.  SMATV systems  offer  subscribers  both improved  reception of local
television  stations  and  many  of  the  same  satellite-delivered  programming
services offered by franchised cable systems. In addition,  some SMATV operators
are developing and/or offering packages of telephony, data and video services to
private  residential and commercial  developments.  SMATV system operators often
enter into  exclusive  service  agreements  with building  owners or homeowners'
associations, although some states have enacted laws to provide franchised cable
systems access to these complexes. Courts have reviewed challenges to these laws
and have reached  varying  results.  Our ability to compete for  subscribers  in
residential  and  commercial  developments  served by SMATV system  operators is
uncertain.  However, we are developing  competitive packages of services (video,
data and telephony) to offer to these residential and commercial developments.

     Cable systems also compete with MMDS or wireless cable  systems,  which are
authorized  to  operate  in areas  served  by our  cable  systems.  Federal  law
significantly  limits  certain  local  restrictions  on  the  use  of  roof-top,
satellite  and  microwave   antennae  to  receive   satellite   programming  and
over-the-air broadcasting services.

     Many of our  cable  systems  are  currently  offering,  or  plan to  offer,
interactive  online computer  services to subscribers.  These cable systems will
compete  with a  number  of  other  companies,  many  of whom  have  substantial
resources, such as:

     o    existing Internet service providers, commonly known as ISPs,

     o    local telephone companies,

     o    long distance telephone companies.

     Recently,  a number of companies,  including telephone companies and ISP's,
have  requested  local  authorities  and the FCC to require  cable  operators to
provide access to cable's  broadband  infrastructure so that these companies may
deliver  Internet  services  directly to customers over cable  facilities.  In a
recent  report to 

                                      - 5 -
<PAGE>

Congress, the FCC declined to institute an administrative  proceeding to examine
this issue at this time. At the present time,  several local  jurisdictions  are
attempting to impose access  obligations  on a cable operator as a condition for
obtaining municipal consent for franchise  transfers;  however,  such conditions
are currently being challenged in court. It is expected that the FCC,  Congress,
and state and local regulatory  authorities will continue to consider actions in
this area.

     The deployment of Asymmetric Digital  Subscriber Line technology,  known as
ADSL,  will allow Internet  access to subscribers  at data  transmission  speeds
equal to or  greater  than that of modems  over  conventional  telephone  lines.
Several telephone  companies are introducing ADSL service and have requested the
FCC  to  allow  them  to  provide  high-speed   broadband  services,   including
interactive  online services,  without regard to present service  boundaries and
other  regulatory  restrictions.  We are unable to  predict  the  likelihood  of
success of the online  services  offered by our competitors or the impact on our
business and operations of these competitive ventures.

     We expect advances in communications  technology, as well as changes in the
marketplace  and the  regulatory  and  legislative  environment  to occur in the
future.  We refer you to the next  section of this Annual  Report for a detailed
discussion of legislative and regulatory  factors.  Other new  technologies  and
services may develop and may compete with services that our cable communications
systems offer. Consequently, we are unable to predict the effect that ongoing or
future developments might have on our business and operations.

                            -----------------------

                           LEGISLATION AND REGULATION

     The  Communications  Act of 1934  establishes a national policy to regulate
the   development   and   operation  of  cable   communications   systems.   The
Communications Act allocates responsibility for enforcing federal policies among
the FCC, and state and local governmental  authorities.  The courts,  especially
the federal  courts,  play an important  oversight  role as these  statutory and
regulatory provisions are interpreted and enforced by the various federal, state
and local governmental units.

     We expect that court  actions and  regulatory  proceedings  will refine the
rights and obligations of various parties,  including the government,  under the
Communications Act. The results of these judicial and administrative proceedings
may materially affect our business operations.  In the following paragraphs,  we
summarize the principal  federal laws and regulations  materially  affecting the
growth and  operation of the cable  communications  industry.  We also provide a
brief description of certain state and local laws applicable to our businesses.

     The Communications Act and FCC Regulations

     The  Communications  Act and the regulations and policies of the FCC affect
significant aspects of our cable system operations, including:

     o    subscriber rates,

     o    the content of  programming we offer our  subscribers,  as well as the
          way we sell our  program  packages  to  subscribers  and  other  video
          program providers,

     o    the use of our cable  systems by local  franchising  authorities,  the
          public and other unrelated third parties,

     o    our franchise agreements with governmental authorities,

     o    cable system ownership limitations and prohibitions,

     o    our use of utility poles and conduit.

     Subscriber Rates

     The  Communications  Act and the FCC's  regulations  and policies limit the
ability of cable  systems to raise rates for basic  services and  equipment,  as
well as for certain  non-basic cable programming  services,  in communities that
are not subject to effective competition, as defined by federal law. Where there
is no effective competition, federal law gives franchising authorities the power
to regulate the monthly rates charged by the operator for:

     o   the  lowest  level  of  programming  service,  typically  called  basic
         service,  which generally  includes local broadcast channels and public
         access or governmental channels required by the operator's franchise,

     o    the  installation,  sale and lease of equipment used by subscribers to
          receive  basic  service,  such as converter  boxes and remote  control
          units.

     Several years ago the FCC adopted detailed rate regulations, guidelines and
rate forms that we and the franchising authority must use in connection with the
regulation  of our  basic  service  and  equipment  rates.  If  the  franchising
authority  concludes  that our rates are not in  accordance  with the FCC's rate
regulations,  it may require 

                                      - 6 -
<PAGE>

us to reduce our rates and to refund overcharges to subscribers,  with interest.
We may appeal adverse rate decisions to the FCC. The  Communications Act and FCC
regulations also permit franchising  authorities to file complaints with the FCC
concerning  rates we charge for  certain  non-basic  cable  programming  service
tiers.

     The Communications Act and the FCC's regulations also:

     o    prohibit   regulation  of  rates   charged  by  cable   operators  for
          programming  offered on a per  channel or per program  basis,  and for
          certain multi-channel groups of new non-basic programming,

     o    eliminate rate regulation of non-basic cable programming service tiers
          after March 31, 1999,  although  Congress may consider  legislation to
          extend the period  during  which  non-basic  rates  remain  subject to
          regulation,

     o    require  operators to charge uniform rates  throughout  each franchise
          area that is not subject to effective competition,

     o    prohibit  regulation of  non-predatory  bulk discount rates offered by
          operators to subscribers in commercial and residential developments,

     o    permit regulated  equipment rates to be computed by aggregating  costs
          of broad categories of equipment at the franchise, system, regional or
          company level.

     Over the past few years, we have reached agreements with various regulatory
bodies  to  resolve  outstanding  rate  disputes.  In  addition  to the  "social
contract" we reached with the FCC, we settled pending local rate  proceedings in
1998  involving our basic  service  rates in certain of our systems.  We believe
that the resolution of these  proceedings did not have a material adverse impact
on our financial position, results of operations or liquidity.

     Content Requirements

     The Communications  Act and the FCC's regulations  contain broadcast signal
carriage requirements that allow local commercial television broadcast stations:

     o    to elect once  every  three  years to  require a cable  communications
          system to carry the station, subject to certain exceptions, or

     o    to negotiate with us on the terms by which we carry the station on our
          cable communications system, commonly called retransmission consent.

     The  Communications Act requires a cable operator to devote up to one-third
of its activated channel capacity for the mandatory carriage of local commercial
television  stations.  The  Communications  Act also gives local  non-commercial
television  stations mandatory carriage rights;  however,  such stations are not
given the option to negotiate  retransmission  consent for the carriage of their
signals by cable systems. Additionally, cable systems must obtain retransmission
consent for:

     o    all "distant"  commercial  television  stations (except for commercial
          satellite-delivered independent "superstations" such as WGN),

     o    commercial radio stations,

     o    certain low-power television stations.

     The FCC has also  initiated an  administrative  proceeding  to consider the
requirements,  if any, for the mandatory  carriage of digital television signals
offered by local  broadcasters.  We are unable to  predict  the  outcome of this
proceeding  or the impact of any new carriage  requirements  on the operation of
our cable systems.

     The  Communications Act requires our cable systems to permit subscribers to
purchase  video  programming on a per channel or a per program basis without the
necessity  of  subscribing  to any tier of  service,  other than the basic cable
service tier. However, we are not required to comply with this requirement until
2002 for any of our cable systems that do not have  addressable  converter boxes
or have other  substantial  technological  limitations.  A limited number of our
systems do not have the  technological  capability to offer  programming  in the
manner required by the statute and thus currently are exempt from complying with
this requirement.

     To increase  competition  between  cable  operators and other video program
distributors, the Communications Act:

     o    precludes  any  satellite  video  programmer  affiliated  with a cable
          company, or with a common carrier providing video programming directly
          to  its  subscribers,   from  favoring  an  affiliated   company  over
          competitors,

     o    requires   such   programmers   to  sell   their   satellite-delivered
          programming to other video program distributors,

     o    limits the ability of such programmers to offer exclusive  programming
          arrangements to their affiliates.

                                      - 7 -
<PAGE>
     In two  recent  administrative  determinations,  the FCC's  Cable  Services
Bureau   concluded   that  the   program   access   rules   did  not   apply  to
terrestrially-delivered  programming,  such as Comcast SportsNet.  These matters
are expected to be reviewed by the FCC.

     The FCC and Congress are presently  considering  proposals that may enhance
the ability of DBS providers and other video program distributors to gain access
to  additional  programming  and to transmit  local  broadcast  signals to local
markets.  These proposals,  if adopted,  will likely increase competition to our
cable systems.

     The Communications  Act contains  restrictions on the transmission by cable
operators of obscene or indecent  programming.  It requires  cable  operators to
block fully both the video and audio  portion of  sexually  explicit or indecent
programming  on channels  that are  primarily  dedicated  to  sexually  oriented
programming or  alternatively  to carry such  programming  only at "safe harbor"
time periods.  A three-judge  federal  district  recently  determined  that this
provision was  unconstitutional;  however, the federal government announced that
it will appeal the lower court's ruling.

     The FCC actively regulates other aspects of our programming, involving such
areas as:

     o    our use of syndicated and network  programs and local sports broadcast
          programming,

     o    advertising in children's programming,

     o    political advertising,

     o    origination cablecasting,

     o    sponsorship identification,

     o    closed captioning of video programming.

     Use of Our Cable Systems by The Government and Unrelated Third Parties

     The Communications  Act allows franchising  authorities and unrelated third
parties to have access to our cable systems' channel capacity. For example, it:

     o    permits  franchising  authorities  to require  cable  operators to set
          aside  channels  for  public,   educational  and  governmental  access
          programming;

     o    requires  a  cable  system  with  36 or  more  activated  channels  to
          designate a significant portion of its channel capacity for commercial
          leased access by third parties to provide programming that may compete
          with services offered by the cable operator.

The FCC  regulates  various  aspects of third  party  commercial  use of channel
capacity  on our  cable  systems,  including  the rates  and  certain  terms and
conditions  of the  commercial  use.  The FCC is also  considering  proposals by
various  Internet  service  providers  to gain access to our cable  systems on a
common  carrier  basis.  We cannot  predict if such proposals will be adopted or
whether,  if  adopted,  they  will  have a  material  impact  upon our  business
operations.

     Franchise Matters

     Although  franchising  matters are  normally  regulated  at the local level
through a franchise  agreement and/or a local ordinance,  the Communications Act
provides  oversight  and  guidelines  to  govern  our  relationship  with  local
franchising authorities. For example, the Communications Act:

     o    affirms  the  right  of  franchising   authorities  (state  or  local,
          depending on the practice in  individual  states) to award one or more
          franchises within their jurisdictions,

     o    generally  prohibits  us  from  operating  in  communities  without  a
          franchise,

     o    encourages competition with our existing cable systems by:

          o    allowing   municipalities   to  operate  cable  systems   without
               franchises,

          o    preventing   franchising   authorities  from  granting  exclusive
               franchises  or from  unreasonably  refusing  to award  additional
               franchises covering an existing cable system's service area.

     o    permits local  authorities,  when granting or renewing our franchises,
          to establish requirements for cable-related  facilities and equipment,
          but prohibits franchising  authorities from establishing  requirements
          for specific video  programming or information  services other than in
          broad categories,

     o    permits us to obtain  modification of our franchise  requirements from
          the franchise  authority or by judicial action if warranted by changed
          circumstances,

     o    generally prohibits franchising authorities from:

          o    imposing   requirements  during  the  initial  cable  franchising
               process or during  franchise  renewal that  require,  prohibit or
               restrict us from providing telecommunications services,

                                      - 8 -
<PAGE>

          o    imposing  franchise  fees on revenues  we derive  from  providing
               telecommunications services over our cable systems, or

          o    restricting  our  use of any  type  of  subscriber  equipment  or
               transmission technology.

     o    limits  our  payment  of  franchise  fees  to  the  local  franchising
          authority to 5% of our gross  revenues  derived from  providing  cable
          services over our cable system.

     The Communications Act contains  procedures  designed to protect us against
arbitrary  denials of the  renewal  of our  franchises,  although a  franchising
authority under various conditions could deny us a franchise renewal.  Moreover,
even if our franchise is renewed,  the franchising  authority may seek to impose
upon us new and  more  onerous  requirements  such as  significant  upgrades  in
facilities  and services or increased  franchise fees as a condition of renewal.
Similarly,  if a franchising authority's consent is required for the purchase or
sale of our cable system or franchise,  the franchising authority may attempt to
impose more  burdensome or onerous  franchise  requirements  on us in connection
with a  request  for  such  consent.  Historically,  cable  operators  providing
satisfactory services to their subscribers and complying with the terms of their
franchises have typically obtained franchise  renewals.  We believe that we have
generally met the terms of our  franchises  and have provided  quality levels of
service.  We anticipate that our future franchise  renewal  prospects  generally
will be favorable.

     Various courts have considered  whether  franchising  authorities  have the
legal right to limit the number of franchises  awarded within a community and to
impose  certain  substantive  franchise   requirements  (e.g.  access  channels,
universal service and other technical  requirements).  These decisions have been
inconsistent  and, until the United States Supreme Court rules  definitively  on
the scope of cable operators' First Amendment  protections,  the legality of the
franchising process generally and of various specific franchise  requirements is
likely to be in a state of flux.

     Ownership Limitations

     The  Communications  Act generally  prohibits us from owning or operating a
SMATV or wireless  cable  system in any area where we provide  franchised  cable
service.  We may,  however,  acquire and operate SMATV systems in our franchised
service  areas  if  the  programming  and  other  services   provided  to  SMATV
subscribers  are offered  according to the terms and conditions of our franchise
agreement.

     The  Communications Act also authorizes the FCC to impose nationwide limits
on the number of  subscribers  under the  control of a cable  operator.  While a
federal district court has declared this limitation to be  unconstitutional  and
delayed its  enforcement,  the FCC  recently  reconsidered  its cable  ownership
regulations and:

     o    reaffirmed  its  30%  nationwide   subscriber   ownership  limit,  but
          maintained  its  voluntary  stay on  enforcement  of  that  regulation
          pending further action,

     o    reaffirmed   its   subscriber    ownership    information    reporting
          requirements,

     o    opened an administrative proceeding to reevaluate its cable television
          attribution rules.

Also  pending  on appeal is a  challenge  to the  statutory  and FCC  regulatory
limitations  on the number of channels that can be occupied on a cable system by
a video  programmer  in which a cable  operator  has an  attributable  ownership
interest.  We are unable to predict the outcome of these judicial and regulatory
proceedings  or the impact of any  ownership  restrictions  on our  business and
operations.

     The Communications  Act eliminated the statutory  prohibition on the common
ownership,  operation or control of a cable  system and a  television  broadcast
station in the same market.  While the FCC has eliminated its regulations  which
precluded the  cross-ownership  of a national  broadcasting  network and a cable
system,  it has not yet completed its review of other regulations which prohibit
the common  ownership of other  broadcasting  interests and cable systems in the
same geographical areas.

     Amendments  to the  Communications  Act made  far-reaching  changes  in the
relationship  between local  telephone  companies  and cable service  providers.
These amendments:

     o    eliminated   federal  legal  barriers  to  competition  in  the  local
          telephone  and cable  communications  businesses,  including  allowing
          local  telephone  companies  to offer  video  services  in their local
          telephone service areas;

     o    preempted  legal  barriers  to  telecommunications   competition  that
          previously existed in state and local laws and regulations;

     o    set  basic  standards  for  relationships  between  telecommunications
          providers; and

     o    generally limited  acquisitions and prohibited  certain joint ventures
          between local telephone

                                      - 9 -
<PAGE>
          companies and cable operators in the same market.

     Local  telephone   companies  may  provide  service  as  traditional  cable
operators  with local  franchises or they may opt to provide  their  programming
over  unfranchised   "open  video  systems,"  subject  to  certain   conditions,
including, but not limited to, setting aside a portion of their channel capacity
for use by unaffiliated program  distributors on a  non-discriminatory  basis. A
federal  appellate  court  recently  overturned  various parts of the FCC's open
video rules,  including the FCC's preemption of local  franchising  requirements
for open video  operators.  We expect the FCC to modify its open video  rules to
comply  with the  federal  court's  decision,  but we are unable to predict  the
impact any rule modifications may have on our business and operations.

     Pole Attachment Regulation

     The  Communications  Act requires the FCC to regulate the rates,  terms and
conditions  imposed by public  utilities for cable  systems' use of utility pole
and conduit  space unless  state  authorities  demonstrate  to the FCC that they
adequately  regulate pole attachment  rates, as is the case in certain states in
which we operate.  In the absence of state regulation,  the FCC administers pole
attachment  rates on a formula basis.  The FCC's current rate formula,  which is
being  reevaluated  by the FCC,  governs the maximum rate certain  utilities may
charge for attachments to their poles and conduit by cable  operators  providing
only  cable   services  and,   until  2001,  by  certain   companies   providing
telecommunications  services.  The FCC also  adopted a second rate  formula that
will be effective in 2001 and will govern the maximum rate certain utilities may
charge  for  attachments  to their  poles and  conduit  by  companies  providing
telecommunications services, including cable operators.

     Any  resulting  increase  in  attachment  rates  due to the  FCC's new rate
formula will be phased in over a five-year  period in equal  annual  increments,
beginning in February 2001. Several parties have requested the FCC to reconsider
its new  regulations and several parties have challenged the new rules in court.
A federal  district  court  recently  upheld  the  constitutionality  of the new
statutory  provision  which  requires that  utilities  provide cable systems and
telecommunications  carriers with nondiscriminatory  access to any pole, conduit
or  right-of-way  controlled  by the  utility;  the  utilities  involved in that
litigation  have appealed the lower court's  decision.  We are unable to predict
the outcome of this  litigation  or the ultimate  impact of any revised FCC rate
formula or of any new pole  attachment  rate  regulations  on our  business  and
operations.

     Other Regulatory Requirements of the
     Communications Act and the FCC

     The Communications Act also includes provisions, among others, regulating:

     o    customer service,

     o    subscriber privacy,

     o    marketing practices,

     o    equal employment opportunity,

     o    technical standards and equipment compatibility.

     The FCC actively  regulates other parts of our cable operations,  involving
such areas as:

     o    hiring and promotion of employees and use of outside vendors,

     o    consumer protection and customer service,

     o    technical standards and testing of cable facilities,

     o    consumer electronics equipment compatibility,

     o    registration of cable systems,

     o    maintenance of various records and public inspection files,

     o    microwave frequency usage,

     o    antenna structure notification, marking and lighting.

     The FCC may enforce its  regulations  through the imposition of substantial
fines,  the issuance of cease and desist orders  and/or the  imposition of other
administrative  sanctions,  such as the  revocation  of FCC  licenses  needed to
operate  certain  transmission  facilities  often used in connection  with cable
operations.  The FCC has  ongoing  rulemaking  proceedings  that may  change its
existing rules or lead to new  regulations.  We are unable to predict the impact
that any further FCC rule changes may have on our business and operations.

     Other bills and administrative proposals pertaining to cable communications
have  previously  been  introduced in Congress or have been  considered by other
governmental  bodies over the past several  years.  It is probable  that further
attempts will be made by Congress and other governmental  bodies relating to the
regulation of cable communications services.

                                     - 10 -

<PAGE>
Copyright

     Our cable  communications  systems provide our  subscribers  with local and
distant  television  and radio  broadcast  signals  which are  protected  by the
copyright  laws.  We generally  do not obtain a license to use this  programming
directly  from the owners of the  programming,  but comply  with an  alternative
federal copyright  licensing process. In exchange for filing certain reports and
contributing a percentage of our revenues to a federal  copyright  royalty pool,
we obtain blanket permission to retransmit copyrighted material.

     In a  report  to  Congress,  the U.S.  Copyright  Office  recommended  that
Congress  make  major  revisions  to both the  cable  television  and  satellite
compulsory licenses. The possible simplification, modification or elimination of
the  compulsory  copyright  license  is the  subject of  continuing  legislative
review.  The  elimination or substantial  modification  of the cable  compulsory
license could adversely  affect our ability to obtain  suitable  programming and
could substantially  increase the cost of programming that remains available for
distribution  to  our  subscribers.  We  cannot  predict  the  outcome  of  this
legislative activity.

     Our cable  communications  systems  often  utilize music in the programs we
provide  to  subscribers   including  local   advertising,   local   origination
programming and pay-per-view events. The rights to use this music are controlled
by music performance rights societies who negotiate on behalf of their copyright
owners for license fees covering each performance. The cable industry and one of
these  societies have agreed upon a standard  licensing  agreement  covering the
performance of music contained in programs  originated by cable operators and in
pay-per-view  events.  Negotiations  on a  similar  licensing  agreement  are in
process  with  another  music  performance  rights  organization.   Rate  courts
established by a federal court exist to determine appropriate copyright coverage
and payments in the event the parties fail to reach a negotiated settlement.  We
cannot  predict  the outcome of these  proceedings  or the amount of any license
fees we may be required to pay for the use of music.  We do not believe that the
amount of such fees will be  significant to our financial  position,  results of
operations or liquidity.

State and Local Regulation

     Our cable systems use local  streets and  rights-of-way.  Consequently,  we
must comply with state and local regulation  which is typically  imposed through
the  franchising  process.  The  terms and  conditions  of our  franchises  vary
materially from jurisdiction to jurisdiction.  Each franchise generally contains
provisions governing:

     o    cable service rates,

     o    franchise fees,

     o    franchise term,

     o    system construction and maintenance obligations,

     o    system channel capacity,

     o    design and technical performance,

     o    customer service standards,

     o    franchise renewal,

     o    sale or transfer of the franchise,

     o    territory of the franchisee,

     o    indemnification of the franchising authority,

     o    use and occupancy of public streets,

     o    types of cable services provided.

     A number of states  subject  cable  systems  to the  jurisdiction  of state
governmental  agencies.  Those states in which we operate that have enacted such
state level regulation are Connecticut, New Jersey and Delaware. State and local
franchising  jurisdiction  is not  unlimited,  however;  it  must  be  exercised
consistently  with federal law. The  Communications  Act  immunizes  franchising
authorities  from monetary  damage awards  arising from the  regulation of cable
systems  or  decisions  made  on  franchise  grants,  renewals,   transfers  and
amendments.

     The summary of certain  federal and state  regulatory  requirements  in the
preceding  pages does not describe all present and proposed  federal,  state and
local regulations and legislation  affecting the cable industry.  Other existing
federal regulations,  copyright licensing, and, in many jurisdictions, state and
local franchise requirements, are currently the subject of judicial proceedings,
legislative hearings and administrative proposals which could change, in varying
degrees, the manner in which cable systems operate. Neither the outcome of these
proceedings nor their impact upon our cable  operations can be predicted at this
time.

                                     - 11 -
<PAGE>
                                    EMPLOYEES

     As of December 31, 1998, we had approximately  8,800 employees.  We believe
that our relationships with our employees are good.


ITEM 2    PROPERTIES

     A central receiving apparatus,  distribution cables,  converters,  customer
service  call  centers and local  business  offices are the  principal  physical
assets  of a cable  communications  system.  We own or lease the  receiving  and
distribution  equipment of each system and own or lease parcels of real property
for the  receiving  sites,  customer  service  call  centers and local  business
offices. In order to keep pace with technological  advances, we are maintaining,
periodically  upgrading  and  rebuilding  the physical  components  of our cable
communications systems.

     We  believe  that  substantially  all of our  physical  assets  are in good
operating condition.

ITEM 3    LEGAL PROCEEDINGS

     We are subject to legal  proceedings and claims which arise in the ordinary
course of our business. In the opinion of our management, the amount of ultimate
liability with respect to these actions will not materially affect our financial
position, results of operations or liquidity.

ITEM 4    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     Information for this Item is omitted pursuant to SEC General  Instruction I
to Form 10-K.



                                     - 12 -

<PAGE>

                                     PART II

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

Common Stock

Absence of Trading Market
Our common  stock is not publicly  traded.  Therefore,  there is no  established
public trading  market for the common stock,  and none is expected to develop in
the foreseeable future.

Holder
All of our  shares  of  common  stock,  $1.00 par  value,  are owned by  Comcast
Corporation.

Dividends
None.

ITEM 6    SELECTED FINANCIAL DATA

Information  for this item is omitted  pursuant to SEC General  Instruction I to
Form 10-K.



                                     - 13 -
<PAGE>

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

     Information for this item is omitted pursuant to SEC General  Instruction I
to Form 10-K, except as noted below.

Liquidity and Capital Resources

     Interest Rate Risk Management

     See Note 4 to our consolidated financial statements included in Item 8.

     We are  exposed to market risk  including  changes in  interest  rates.  To
manage  the  volatility  relating  to these  exposures,  we enter  into  various
derivative  transactions  pursuant to our policies in areas such as counterparty
exposure  and  hedging  practices.  Positions  are  monitored  using  techniques
including  market value and  sensitivity  analyses.  We do not hold or issue any
derivative  financial  instruments  for trading  purposes and are not a party to
leveraged instruments. The credit risks associated with our derivative financial
instruments  are  controlled  through  the  evaluation  and  monitoring  of  the
creditworthiness of the counterparties.  Although we may be exposed to losses in
the event of nonperformance by the counterparties, we do not expect such losses,
if any, to be significant.

     Interest Rate Risk

     The use of interest rate risk management instruments, such as interest rate
exchange  agreements  ("Swaps"),  interest  rate  cap  agreements  ("Caps")  and
interest  rate collar  agreements  ("Collars"),  is required  under the terms of
certain of our  outstanding  debt  agreements.  Our policy is to manage interest
costs using a mix of fixed and  variable  rate debt.  Using  Swaps,  we agree to
exchange,  at specified  intervals,  the  difference  between fixed and variable
interest amounts  calculated by reference to an agreed-upon  notional  principal
amount.  Caps are used to lock in a maximum  interest rate should variable rates
rise,  but enable us to otherwise  pay lower  market  rates.  Collars  limit our
exposure to and benefits from interest rate  fluctuations  on variable rate debt
to within a certain range of rates.

     The table set forth below  summarizes the fair values and contract terms of
financial  instruments  subject to  interest  rate risk  maintained  by us as of
December 31, 1998 (dollars in millions):

<TABLE>
<CAPTION>
                                                    Expected Maturity Date                                 Fair Value at
                                  1999       2000       2001       2002       2003    Thereafter   Total     12/31/98
                                  ----       ----       ----       ----       ----    ----------   -----     --------
<S>                                 <C>        <C>      <C>        <C>          <C>    <C>        <C>        <C>     
Debt

Fixed Rate....................      $0.1       $0.1     $100.0     $100.1       $0.1   $2,489.8   $2,690.2   $2,994.0
   Average Interest Rate......     10.9%      11.0%       8.6%       8.6%      10.0%       7.8%       7.8%

Variable Rate.................                $72.0     $109.4     $131.2     $459.4                $772.0     $772.0
   Average Interest Rate......                 5.8%       6.0%       6.1%       6.2%                  6.1%

Interest Rate Instruments

Variable to Fixed Swaps.......     $50.0                                                             $50.0     ($0.1)
   Average Pay Rate...........      5.7%                                                              5.7%
   Average Receive Rate.......      5.0%                                                              5.0%
Caps..........................    $240.0                                                            $240.0
   Average Cap Rate...........      7.0%                                                              7.0%
Collar........................                $50.0                                                  $50.0
   Average Cap Rate...........                 6.3%                                                   6.3%
   Average Floor Rate.........                 4.0%                                                   4.0%
</TABLE>


                                      -14-

<PAGE>

     The  notional  amounts of interest  rate  instruments,  as presented in the
table  above are used to  measure  interest  to be paid or  received  and do not
represent  the amount of  exposure  to credit  loss.  The  estimated  fair value
approximates the proceeds (costs) to settle the outstanding contracts.  Interest
rates on variable  debt are  estimated by us using the average  implied  forward
London  Interbank  Offer Rate ("LIBOR")  rates for the year of maturity based on
the yield curve in effect at December 31,  1998,  plus the  borrowing  margin in
effect for each credit  facility at December 31, 1998.  Average receive rates on
the  Variable  to Fixed  Swaps are  estimated  by us using the  average  implied
forward LIBOR rates for the year of maturity  based on the yield curve in effect
at December 31, 1998. While Swaps,  Caps and Collars  represent an integral part
of our  interest  rate risk  management  program,  their  incremental  effect on
interest  expense  for the  years  ended  December  31,  1998  and  1997 was not
significant.



Results of Operations

     We are a wholly owned subsidiary of Comcast  Corporation  ("Comcast").  Our
summarized  consolidated  financial information for the years ended December 31,
1998 and 1997 is as follows (dollars in millions, "NM" denotes percentage is not
meaningful):

<TABLE>
<CAPTION>
                                                                     Year Ended
                                                                     December 31,           Increase / (Decrease)
                                                                   1998         1997           $            %
<S>                                                              <C>          <C>            <C>            <C> 
Service income............................................       $2,277.4     $2,073.0       $204.4         9.9%
Operating, selling, general and administrative expenses...        1,493.0      1,363.6        129.4         9.5
                                                                 --------     --------      -------
Operating income before depreciation and
   amortization (1).......................................          784.4        709.4         75.0        10.6
Depreciation and amortization.............................          674.1        626.1         48.0         7.7
                                                                 --------     --------      -------
Operating income..........................................          110.3         83.3         27.0        32.4
                                                                 --------     --------      -------
Interest expense..........................................          223.6        227.9         (4.3)       (1.9)
Interest expense on notes payable to affiliates...........           52.1         37.3         14.8        39.7
Investment income.........................................          (14.6)        (5.1)         9.5          NM
Other income..............................................           (0.8)        (0.1)         0.7          NM
Income tax benefit........................................          (35.8)       (43.6)        (7.8)      (17.9)
Minority interest.........................................          (17.0)       (21.0)        (4.0)      (19.0)
Extraordinary items.......................................           (0.1)       (16.7)       (16.6)         NM
                                                                 --------     --------      -------
Net loss..................................................         ($97.3)     ($128.8)      ($31.5)     (24.5%)
                                                                 ========     ========      =======  
<FN>
------------
(1)  Operating income before  depreciation and amortization is commonly referred
     to in the cable communications business as "operating cash flow." Operating
     cash flow is a measure of a company's  ability to generate  cash to service
     its obligations, including debt service obligations, and to finance capital
     and other expenditures.  In part due to the capital intensive nature of the
     cable  communications  business  and the  resulting  significant  level  of
     non-cash  depreciation  and  amortization  expense,  operating cash flow is
     frequently  used as one of the bases for comparing  businesses in the cable
     communications  industry,  although our measure of operating  cash flow may
     not  be  comparable  to  similarly  titled  measures  of  other  companies.
     Operating  cash flow does not purport to  represent  net income or net cash
     provided  by  operating  activities,  as  those  terms  are  defined  under
     generally accepted accounting  principles,  and should not be considered as
     an alternative to such measurements as an indicator of our performance.
</FN>
</TABLE>

                                     - 15 -
<PAGE>

     Of the $204.4 million  increase in service income from 1997 to 1998,  $30.2
million  is   attributable   to  the  effects  of  the   acquisitions  of  cable
communications  systems,  $31.8 million is  attributable  to subscriber  growth,
$109.0 million relates to the changes in rates, $20.5 million is attributable to
growth in cable  advertising  sales and $12.9  million  relates to other product
offerings.

     Of  the  $129.4  million  increase  in  operating,   selling,  general  and
administrative  expenses from 1997 to 1998, $19.3 million is attributable to the
effects of the acquisitions of cable  communications  systems,  $66.2 million is
attributable  to an  increase in the costs of cable  programming  as a result of
subscriber  growth,  additional  channel  offerings  and changes in rates,  $1.5
million  is  attributable  to an  increase  in costs  associated  with  customer
service,  $5.3 million is attributable to growth in cable  advertising sales and
$37.1  million  results  from an  increase in the costs of labor,  other  volume
related  expenses  and  costs  associated  with  new  product  offerings.  It is
anticipated  that our cost of cable  programming  will increase in the future as
cable  programming  rates increase and additional  sources of cable  programming
become available.

     Comcast,  on our  behalf,  has an  affiliation  agreement  with  QVC,  Inc.
("QVC"), an electronic  retailer and a majority-owned and controlled  subsidiary
of Comcast, to carry its programming. In return for carrying QVC programming, we
receive an allocated  portion,  based upon market share,  of a percentage of net
sales of merchandise sold to QVC customers  located in our service area. For the
years ended  December  31,  1998 and 1997,  our service  income  includes  $13.3
million and $10.2 million, respectively, relating to QVC.

     Comcast,  through  management  agreements,  manages the  operations  of our
subsidiaries,   including  rebuilds  and  upgrades.  The  management  agreements
generally  provide that Comcast will  supervise the management and operations of
the cable systems and arrange for and  supervise  (but not  necessarily  perform
itself) certain administrative functions. As compensation for such services, the
agreements  provide for Comcast to charge  management  fees of up to 6% of gross
revenues. Comcast charged our subsidiaries management fees of $130.4 million and
$119.7 million during the years ended December 31, 1998 and 1997,  respectively.
These  management  fees are  included  in selling,  general  and  administrative
expenses in our consolidated statement of operations.

     On our behalf,  Comcast seeks and secures long-term  programming  contracts
that generally  provide for payment based on either a monthly fee per subscriber
per channel or a percentage of certain subscriber revenues. Comcast charges each
of our subsidiaries for programming on a basis which generally  approximates the
amount  that  each  such  subsidiary  would  be  charged  if it  purchased  such
programming  directly from the supplier,  subject to limitations imposed by debt
facilities  for certain  subsidiaries,  and did not benefit from the  purchasing
power of Comcast's consolidated operations. Amounts charged to us by Comcast for
programming (the  "Programming  Charges") are included in operating  expenses in
our  consolidated  statement of operations.  We purchase certain other services,
including  insurance  and employee  benefits,  from Comcast  under  cost-sharing
arrangements on terms that reflect  Comcast's actual cost. We reimburse  Comcast
for  certain  other  expenses  (primarily  salaries)  under   cost-reimbursement
arrangements.  Under all of these  arrangements,  we incurred  total expenses of
$760.9 million and $674.6 million,  including  $640.5 million and $560.9 million
of  Programming  Charges,  during the years  ended  December  31, 1998 and 1997,
respectively.  The  Programming  Charges include $59.4 million and $49.0 million
during the years ended  December  31, 1998 and 1997,  respectively,  relating to
programming  purchased by us, through  Comcast,  from suppliers in which Comcast
holds an equity interest.

     The $48.0 million increase in depreciation  and  amortization  expense from
1997 to 1998 is  primarily  attributable  to the effects  capital  expenditures,
increased  losses on asset disposals in connection  with our rebuild  activities
and  the  acquisition  of  cable  communications  systems.  

     We anticipate that, for the foreseeable future,  interest expense will be a
significant cost to us and will have a significant adverse effect on our ability
to realize  net  earnings.  We believe we will  continue  to be able to meet our
obligations  through  our  ability  both to  generate  operating  income  before
depreciation and amortization and to obtain external financing.

     The  $14.8  million  increase  in  interest  expense  on notes  payable  to
affiliates  from 1997 to 1998 is  primarily  attributable  to  increases  in the
average balance of notes outstanding.

     The  $9.5  million  increase  in  investment  income  from  1997 to 1998 is
primarily  attributable  to the $7.9 million gain  recognized on the exchange of
our interest in Teleport Communications Group, Inc. for AT&T common stock during
1998.

     The $7.8  million  decrease  in  income  tax  benefit  from 1997 to 1998 is
primarily  attributable  to the decrease in our loss before  income tax benefit,
minority interest and extraordinary items.

                                     - 16 -
<PAGE>

     The  $4.0  million  decrease  in  minority  interest  from  1997 to 1998 is
attributable  to the effects of a decrease in the net loss of our majority owned
subsidiary, Comcast MHCP Holdings, L.L.C.

     In connection with the refinancing and redemption of certain  subsidiaries'
indebtedness,  we expensed  unamortized debt acquisition costs and incurred debt
extinguishment  costs of $27.1 million,  resulting in an extraordinary loss, net
of tax, of $16.7 million during the year ended December 31, 1997.

     For the years  ended  December  31,  1998 and  1997,  our  earnings  before
extraordinary  items, income tax benefit and fixed charges (interest expense and
interest  expense on notes payable to affiliates) were $142.7 million and $109.5
million,  respectively.  Such  earnings  were not  adequate  to cover  our fixed
charges of $275.7  million and $265.2  million for the years ended  December 31,
1998 and 1997, respectively. Our fixed charges include non-cash interest expense
of $2.7 million and $2.6 million for the years ended December 31, 1998 and 1997,
respectively.  The  inadequacy  of these  earnings  to cover  fixed  charges  is
primarily  due  to  the  substantial   non-cash  charges  for  depreciation  and
amortization expense.

     We believe  that our losses  and  inadequacy  of  earnings  to cover  fixed
charges will not  significantly  affect the  performance of our normal  business
activities   because  of  our  existing  cash,  cash   equivalents,   short-term
investments  and cash held by an  affiliate,  our ability to generate  operating
income before  depreciation  and amortization and our ability to obtain external
financing.

     We believe that our operations are not materially affected by inflation.

     Year 2000 Issue

     The Year 2000 Issue is the result of computer  programs being written using
two  digits  rather  than four to define  the  applicable  year.  Certain of our
computer programs that have  date-sensitive  software may recognize a date using
"00" as the year 1900 rather than the year 2000 (the "Year 2000 Issue"). If this
situation   occurs,   the  potential  exists  for  computer  system  failure  or
miscalculations   by  computer   programs,   which  could  cause  disruption  of
operations.

     We are in the process of evaluating  and  addressing the impact of the Year
2000 Issue on our  operations  to ensure  that our  information  technology  and
business  systems  recognize  calendar Year 2000. We are utilizing both internal
and external resources in implementing our Year 2000 program,  which consists of
the following phases:

     o    Assessment  Phase.   Structured   evaluation,   including  a  detailed
          inventory  outlining  the impact  that the Year 2000 Issue may have on
          current operations.

     o    Detailed Planning Phase.  Establishment of priorities,  development of
          specific  action  steps and  allocation  of  resources  to address the
          issues identified in the Assessment Phase.

     o    Conversion Phase. Implementation of the necessary system modifications
          as outlined in the Detailed Planning Phase.

     o    Testing Phase.  Verification that the modifications implemented in the
          Conversion  Phase will be  successful in resolving the Year 2000 Issue
          so that all inventory items will function properly,  both individually
          and on an integrated basis.

     o    Implementation  Phase.  Final roll-out of fully tested components into
          an operational unit.

     Based on an  inventory  conducted  in  1997,  we have  identified  computer
systems that will require modification or replacement so that they will properly
utilize dates beyond December 31, 1999. Many of our critical systems are new and
are already Year 2000 compliant as a result of the recent rebuild of many of our
cable communications systems. In addition, we have initiated communications with
all of our significant software suppliers and service bureaus to determine their
plans for remediating the Year 2000 Issue in their software which we use or rely
upon. 


     As of December 31, 1998,  we are in the  Conversion  Phase of our Year 2000
remediation  program and have entered the Testing  Phase with respect to certain
of our key systems.  Through  December 31, 1998, we have incurred  approximately
$2.6 million in connection with our Year 2000 remediation  program.  We estimate
that we will incur between  approximately $4 million to $6 million of additional
expense  through  December  1999 in  connection  with our Year 2000  remediation
program.  Our estimate to complete the  remediation  plan includes the estimated
time  associated  with  mitigating the Year 2000 Issue for third party software.
However,  we cannot  guarantee  that the systems of other  companies on which we
rely will be  converted  on a timely  basis,  or that a failure  to  convert  by
another company would not have a material adverse effect on us.

                                     - 17 -
<PAGE>

     Our  management  will continue to  periodically  report the progress of our
Year 2000  remediation  program to the Audit  Committee  of  Comcast's  Board of
Directors.  We plan to complete the Year 2000 mitigation by the third quarter of
1999. Our management has  investigated  and may consider  potential  contingency
plans in the event that our Year 2000  remediation  program is not  completed by
that date.

     The costs of the project and the date on which we plan to complete the Year
2000 modifications and replacements are based on our best estimates,  which were
derived using assumptions of future events including the continued  availability
of resources and the reliability of third party modification plans.  However, we
cannot  guarantee that these estimates will be achieved and actual results could
differ  materially  from  those  plans.  Specific  factors  that may cause  such
material  differences include, but are not limited to, the availability and cost
of personnel  with  appropriate  necessary  skills and the ability to locate and
correct all relevant computer code and similar uncertainties.

     We believe that with  modifications to existing software and conversions to
new  software,  the  Year  2000  Issue  can  be  mitigated.   However,  if  such
modifications  and  conversions  are not made,  or are not  completed  within an
adequate time frame, the Year 2000 Issue could have a material adverse impact on
our operations.

                                     - 18 -
<PAGE>
ITEM 8    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA





INDEPENDENT AUDITORS' REPORT

Board of Directors and Stockholder
Comcast Cable Communications, Inc.
Wilmington, Delaware

We have audited the  accompanying  consolidated  balance  sheet of Comcast Cable
Communications,  Inc. (a wholly owned  subsidiary  of Comcast  Corporation)  and
subsidiaries  as of  December  31, 1998 and 1997,  and the related  consolidated
statements of operations,  stockholder's  equity  (deficiency) and of cash flows
for each of the  three  years in the  period  ended  December  31,  1998.  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 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,  such consolidated  financial  statements present fairly, in all
material respects, the financial position of Comcast Cable Communications,  Inc.
and  subsidiaries  as of December  31,  1998 and 1997,  and the results of their
operations  and their cash flows for each of the three years in the period ended
December 31, 1998 in conformity with generally accepted accounting principles.

As discussed in Note 2 to the consolidated  financial  statements,  on April 24,
1997, Comcast Corporation completed a restructuring of the legal organization of
certain of its subsidiaries.  The Company's  consolidated  financial  statements
have  been  presented  giving  effect  to the  reorganization  for  all  periods
presented in a manner similar to a pooling of interests.



/s/ Deloitte & Touche LLP
Philadelphia, Pennsylvania
February 22, 1999


                                     - 19 -

<PAGE>
COMCAST CABLE COMMUNICATIONS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET
(Dollars in millions, except share data)

<TABLE>
<CAPTION>
                                                                                               December 31,
                                                                                            1998            1997
<S>                                                                                      <C>               <C>      
ASSETS
CURRENT ASSETS
   Cash and cash equivalents....................................................            $34.5             $40.7
   Investments..................................................................             13.4               0.4
   Cash held by an affiliate....................................................             57.1              56.6
   Accounts receivable, less allowance for doubtful
     accounts of $19.4 and $16.7................................................             90.9              72.8
   Inventories..................................................................             34.6              31.3
   Other current assets.........................................................             14.9              18.0
                                                                                         --------          --------
       Total current assets.....................................................            245.4             219.8
                                                                                         --------          --------
PROPERTY AND EQUIPMENT..........................................................          3,276.5           2,667.3
   Accumulated depreciation.....................................................         (1,180.4)         (1,021.2)
                                                                                         --------          --------
   Property and equipment, net..................................................          2,096.1           1,646.1
                                                                                         --------          --------
DEFERRED CHARGES
   Franchise acquisition costs..................................................          3,833.1           3,818.0
   Excess of cost over net assets acquired and other............................          2,043.3           1,837.7
                                                                                         --------          --------
                                                                                          5,876.4           5,655.7
   Accumulated amortization.....................................................         (1,768.5)         (1,463.8)
                                                                                         --------          --------
   Deferred charges, net........................................................          4,107.9           4,191.9
                                                                                         --------          --------
                                                                                         $6,449.4          $6,057.8
                                                                                         ========          ========
LIABILITIES AND STOCKHOLDER'S EQUITY
CURRENT LIABILITIES
   Accounts payable and accrued expenses........................................           $324.0            $239.9
   Accrued interest.............................................................             35.4              26.6
   Deferred income taxes, due to affiliate......................................              4.6
   Current portion of long-term debt............................................              0.1              52.8
   Due to affiliates............................................................            166.6             125.6
                                                                                         --------          --------
       Total current liabilities................................................            530.7             444.9
                                                                                         --------          --------
LONG-TERM DEBT, less current portion............................................          3,462.1           2,554.9
                                                                                         --------          --------
MINORITY INTEREST AND OTHER.....................................................            181.8             208.5
                                                                                         --------          --------
NOTES PAYABLE TO AFFILIATES.....................................................            134.6             695.2
                                                                                         --------          --------
DUE TO AFFILIATE................................................................            524.8             398.8
                                                                                         --------          --------
DEFERRED INCOME TAXES, due to affiliate.........................................          1,442.4           1,488.4
                                                                                         --------          --------
COMMITMENTS AND CONTINGENCIES

STOCKHOLDER'S EQUITY
   Common stock, $1 par value - authorized and issued, 1,000 shares.............
   Additional capital...........................................................          3,066.2           3,066.2
   Accumulated deficit..........................................................         (2,896.4)         (2,799.1)
   Unrealized gains on marketable securities....................................              3.2
                                                                                         --------          --------
       Total stockholder's equity...............................................            173.0             267.1
                                                                                         --------          --------
                                                                                         $6,449.4          $6,057.8
                                                                                         ========          ========
</TABLE>

See notes to consolidated financial statements.

                                     - 20 -
<PAGE>
COMCAST CABLE COMMUNICATIONS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF OPERATIONS
(Dollars in millions)
<TABLE>
<CAPTION>
                                                                                   Year Ended December 31,
                                                                          1998              1997             1996

<S>                                                                     <C>              <C>               <C>     
SERVICE INCOME................................................          $2,277.4         $2,073.0          $1,641.0

COSTS AND EXPENSES
   Operating..................................................             972.5            884.1             667.8
   Selling, general and administrative........................             520.5            479.5             366.6
   Depreciation and amortization..............................             674.1            626.1             420.3
                                                                        --------         --------          --------
                                                                         2,167.1          1,989.7           1,454.7
                                                                        --------         --------          --------

OPERATING INCOME..............................................             110.3             83.3             186.3

OTHER (INCOME) EXPENSE
   Interest expense...........................................             223.6            227.9             228.4
   Interest expense on notes payable to affiliates............              52.1             37.3              32.1
   Investment income..........................................             (14.6)            (5.1)            (25.9)
   Other (income) expense.....................................              (0.8)            (0.1)              0.5
                                                                        --------         --------          --------
                                                                           260.3            260.0             235.1
                                                                        --------         --------          --------

LOSS BEFORE INCOME TAX BENEFIT, MINORITY
   INTEREST AND EXTRAORDINARY ITEMS...........................            (150.0)          (176.7)            (48.8)

INCOME TAX BENEFIT............................................             (35.8)           (43.6)             (4.5)
                                                                        --------         --------          --------

LOSS BEFORE MINORITY INTEREST AND
   EXTRAORDINARY ITEMS........................................            (114.2)          (133.1)            (44.3)

MINORITY INTEREST.............................................             (17.0)           (21.0)            (21.7)
                                                                        --------         --------          --------

LOSS BEFORE EXTRAORDINARY ITEMS...............................             (97.2)          (112.1)            (22.6)

EXTRAORDINARY ITEMS...........................................              (0.1)           (16.7)
                                                                        --------         --------          --------

NET LOSS......................................................            ($97.3)         ($128.8)           ($22.6)
                                                                        ========         ========          ========
</TABLE>


See notes to consolidated financial statements.

                                     - 21 -

<PAGE>
COMCAST CABLE COMMUNICATIONS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CASH FLOWS
(Dollars in millions)
<TABLE>
<CAPTION>
                                                                                  Year Ended December 31,
                                                                         1998              1997             1996
<S>                                                                       <C>            <C>                 <C>    
OPERATING ACTIVITIES
   Net loss...................................................            ($97.3)         ($128.8)           ($22.6)
                                                                        --------         --------          -------- 
   Adjustments to reconcile net loss to net cash provided
    by operating activities:
     Depreciation and amortization............................             674.1            626.1             420.3
     Non-cash interest expense................................               0.4              1.4               2.0
     Non-cash interest expense on notes payable to affiliates.               2.3              1.2               6.2
     Deferred expenses charged by an affiliate................             126.0            107.0              66.6
     (Gain) loss on sales of investments......................              (7.9)             1.6             (19.8)
     Minority interest........................................             (17.0)           (21.0)            (21.7)
     Extraordinary items......................................               0.1             16.7
     Deferred income tax benefit, due to affiliate............             (43.1)           (49.7)            (44.6)
     Other....................................................              (0.8)
                                                                        --------         --------          -------- 
                                                                           636.8            554.5             386.4

     Changes in working capital...............................              64.3             (5.0)             13.6
                                                                        --------         --------          -------- 
       Net cash provided by operating activities..............             701.1            549.5             400.0
                                                                        --------         --------          -------- 

FINANCING ACTIVITIES
   Proceeds from borrowings...................................           1,724.9          1,805.8             448.0
   Repayments of long-term debt...............................            (870.9)        (2,395.1)           (284.5)
   Proceeds from notes payable to affiliates..................             137.4            699.1              59.7
   Repayment of notes payable to affiliates...................            (700.3)          (104.7)             (1.4)
   Net transactions with affiliates...........................              41.0            (26.7)             92.5
   Deferred financing costs and other.........................             (12.0)           (15.8)             (2.7)
                                                                        --------         --------          -------- 
     Net cash provided by (used in) financing activities......             320.1            (37.4)            311.6
                                                                        --------         --------          -------- 

INVESTING ACTIVITIES
   Acquisitions, net of cash acquired.........................            (259.7)            (7.1)             (5.0)
   Sale of short-term investments.............................               0.1             21.6
   Capital expenditures.......................................            (711.1)          (497.8)           (298.2)
   Increase in cash held by an affiliate......................              (0.5)            (3.1)            (26.6)
   Increase in notes receivable from affiliates...............                                               (340.0)
   Additions to deferred charges and other....................             (56.2)           (23.4)            (15.0)
                                                                        --------         --------          -------- 
       Net cash used in investing activities..................          (1,027.4)          (509.8)           (684.8)
                                                                        --------         --------          -------- 

(DECREASE) INCREASE IN CASH AND CASH
   EQUIVALENTS................................................              (6.2)             2.3              26.8

CASH AND CASH EQUIVALENTS, beginning of year..................              40.7             38.4              11.6
                                                                        --------         --------          -------- 

CASH AND CASH EQUIVALENTS, end of year........................             $34.5            $40.7             $38.4
                                                                        ========         ========          ========
</TABLE>

See notes to consolidated financial statements.

                                     - 22 -
<PAGE>
COMCAST CABLE COMMUNICATIONS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF STOCKHOLDER'S EQUITY (DEFICIENCY)
(Dollars in millions)

<TABLE>
<CAPTION>
                                                                                                    Accumulated Other
                                                                                                   Comprehensive Loss
                                                                                            Notes      Unrealized
                                                                                         Receivable     Gains on
                                                        Common    Additional  Accumulated   from       Marketable
                                                         Stock      Capital     Deficit   Affiliate    Securities    Total

<S>                                                   <C>          <C>       <C>           <C>           <C>       <C>   
BALANCE, JANUARY 1, 1996...........................  $             $1,463.7  ($2,101.4)   ($437.0)         $9.7  ($1,065.0)
   Comprehensive loss:
   Net loss........................................                              (22.6)
   Unrealized loss on marketable securities, net of
     deferred taxes of ($6.0)......................                                                       (11.1)
   Total comprehensive loss........................                                                                  (33.7)
   Capital contributions...........................                 1,552.5                                        1,552.5
   Interest income on notes receivable from affiliate                  52.9                 (52.9)
   Income taxes on interest income on notes receivable
     from affiliate................................                   (18.5)                                         (18.5)
   Increase in notes receivable from affiliate.....                                        (340.0)                  (340.0)
                                                       ----------  --------  ---------     ------        -------   -------
BALANCE, DECEMBER 31, 1996.........................                 3,050.6   (2,124.0)    (829.9)         (1.4)      95.3
   Comprehensive loss:
   Net loss........................................                             (128.8)
   Change in unrealized loss on marketable securities,
     net of deferred taxes of $0.7.................                                                         1.4
   Total comprehensive loss........................                                                                 (127.4)
   Interest income on notes receivable from affiliate                  23.9                 (23.9)
   Income taxes on interest income on notes receivable
     from affiliate................................                    (8.3)                                          (8.3)
   Exchange of outstanding notes payable to and
     notes receivable from affiliates..............                                         307.5                    307.5
   Elimination of outstanding notes receivable from
     affiliate through a non-cash dividend to Comcast                           (546.3)     546.3
                                                       ----------  --------  ---------     ------        -------   -------
BALANCE, DECEMBER 31, 1997.........................                 3,066.2   (2,799.1)                              267.1
   Comprehensive loss:
   Net loss........................................                              (97.3)
   Unrealized gains on marketable securities,
     net of deferred taxes of $1.7.................                                                         3.2
   Total comprehensive loss........................                                                                  (94.1)
                                                       ----------  --------  ---------     ------        -------   -------
BALANCE, DECEMBER 31, 1998.........................    $           $3,066.2  ($2,896.4)    $                $3.2    $173.0
                                                       ==========  ========  =========     ======        =======   =======
</TABLE>

See notes to consolidated financial statements.

                                     - 23 -

<PAGE>
COMCAST CABLE COMMUNICATIONS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996


1.   BUSINESS

     Comcast   Cable   Communications,   Inc.,  a  Delaware   corporation,   and
     subsidiaries  (the  "Company")  is a wholly  owned  subsidiary  of  Comcast
     Corporation  ("Comcast").  The Company and its  subsidiaries are engaged in
     the development, management and operation of hybrid-fiber coaxial broadband
     cable  networks.  The Company's  systems served  approximately  4.5 million
     subscribers and passed  approximately  7.4 million homes as of December 31,
     1998.

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND OTHER ITEMS

     Basis of Consolidation
     The consolidated  financial  statements include the accounts of the Company
     and  all  wholly  owned  or  controlled   subsidiaries.   All   significant
     intercompany  accounts and transactions  among  consolidated  entities have
     been eliminated.

     Reorganization
     On  April  24,  1997,  Comcast  completed  a  restructuring  of  the  legal
     organization of certain of its  subsidiaries  (the  "Reorganization").  The
     Reorganization  involved Comcast's contribution to the Company of ownership
     interests in certain of its  consolidated  subsidiaries,  all of which were
     under   Comcast's   direct   or   indirect   control   (the    "Contributed
     Subsidiaries").  The  Reorganization  has  been  accounted  for in a manner
     similar to a pooling of interests.  Accordingly, the Company's consolidated
     financial  statements include the accounts of the Contributed  Subsidiaries
     for all periods presented.

     In addition,  certain expenses directly related to the Company's operations
     which were  historically paid by Comcast on behalf of the Company have been
     reflected in the Company's  consolidated  statement of  operations  for all
     periods presented.

     Management's 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 the  reported  amounts of revenues  and expenses
     during  the  reporting  period.  Actual  results  could  differ  from those
     estimates.

     Fair Values
     The estimated fair value amounts  presented in these notes to  consolidated
     financial  statements  have been  determined by the Company using available
     market  information and appropriate  methodologies.  However,  considerable
     judgment is required in  interpreting  market data to develop the estimates
     of  fair  value.  The  estimates   presented  herein  are  not  necessarily
     indicative  of the  amounts  that the  Company  could  realize in a current
     market exchange.  The use of different market assumptions and/or estimation
     methodologies  may have a  material  effect  on the  estimated  fair  value
     amounts.  Such fair  value  estimates  are based on  pertinent  information
     available to management as of December 31, 1998 and 1997, and have not been
     comprehensively  revalued  for  purposes  of these  consolidated  financial
     statements since such dates.

     A reasonable  estimate of fair value of the amounts due to/from  affiliates
     in the Company's  consolidated  balance sheet is not  practicable to obtain
     because of the related  party  nature of these items and the lack of quoted
     market prices.

     Cash Equivalents and Cash Held by an Affiliate
     Cash  equivalents   principally  consist  of  repurchase   agreements  with
     maturities of three months or less when purchased.  The carrying amounts of
     the Company's cash equivalents approximate their fair values.

                                     - 24 -
<PAGE>
COMCAST CABLE COMMUNICATIONS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996 (Continued)


     Cash held by an affiliate  consists of cash held by a subsidiary of Comcast
     under a cash management program (see Note 6).

     Investments
     Investments  consist  principally of equity  securities and certificates of
     deposit with maturities of greater than three months when purchased.

     Investments  in  entities  in which the Company has the ability to exercise
     significant  influence  over the operating  and  financial  policies of the
     investee and  investments in  partnerships  which are not controlled by the
     Company  are  accounted  for  under  the  equity   method.   Equity  method
     investments  are  recorded at original  cost and adjusted  periodically  to
     recognize the Company's proportionate share of the investees' net income or
     losses  after the date of  investment,  additional  contributions  made and
     dividends   received.   

     Unrestricted  publicly  traded  investments are classified as available for
     sale and  recorded at their fair  value,  with  unrealized  gains or losses
     resulting from changes in fair value between  measurement dates recorded as
     a component of other comprehensive income.

     Investments in privately  held  companies are stated at cost,  adjusted for
     any known diminution in value.

     Inventories
     Inventories,  which include  materials and supplies,  are stated at average
     cost which is less than market.

     Property and Equipment
     Property and  equipment are stated at cost.  Depreciation  is provided on a
     straight-line basis over estimated useful lives as follows:

          Buildings and improvements ........................  15-40 years
          Operating facilities...............................   5-20 years
          Other equipment....................................   2-10 years

     Improvements  that extend asset lives are  capitalized;  other  repairs and
     maintenance  charges  are  expensed  as  incurred.  The  cost  and  related
     accumulated  depreciation  applicable to assets sold or retired are removed
     from the accounts and the gain or loss on  disposition  is  recognized as a
     component of depreciation expense.

     In connection  with the rebuild and upgrade of cable  systems,  the Company
     depreciates  the  remaining net book value of the assets over the estimated
     rebuild  or  upgrade  period.  Under  this  policy,  the  Company  recorded
     additional  depreciation expense of $34.4 million,  $24.6 million and $15.8
     million  during  the  years  ended  December  31,  1998,   1997  and  1996,
     respectively.

     Deferred Charges
     Franchise  acquisition  costs are amortized on a  straight-line  basis over
     their legal or estimated useful lives of 12 to 40 years. The excess of cost
     over the  fair  value  of net  assets  acquired  is  being  amortized  on a
     straight-line  basis over  estimated  useful lives of 20 to 40 years.  Debt
     acquisition  costs are being  amortized on a  straight-line  basis over the
     term of the related debt.

     Valuation of Long-Lived Assets
     The Company  periodically  evaluates the  recoverability  of its long-lived
     assets,  including  property  and  equipment  and deferred  charges,  using
     objective  methodologies.  Such methodologies  include evaluations based on
     the cash flows generated by the underlying assets or other  determinants of
     fair value.

                                     - 25 -
<PAGE>
COMCAST CABLE COMMUNICATIONS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996 (Continued)


     Revenue Recognition
     Service income is recognized as service is provided. Credit risk is managed
     by disconnecting services to customers who are delinquent.

     Postretirement and Postemployment Benefits
     The estimated costs of retiree benefits and benefits for former or inactive
     employees, after employment but before retirement, are accrued and recorded
     as a charge to operations  during the years the employees provide services.
     The Company's  retiree benefit  obligation is unfunded and all benefits are
     provided and paid by Comcast.  Accordingly,  the  Company's  liability  for
     these costs is included in due to affiliates.

     A wholly owned subsidiary of the Company has agreements with certain former
     key  executives  that provide for  supplemental  retirement  benefits.  The
     actuarial present value of benefits payable under these agreements has been
     accrued.

     Investment Income
     Investment income includes interest income and gains, net of losses, on the
     sale or exchange of marketable securities and long-term investments.  Gross
     realized gains and losses are recognized using the specific  identification
     method.

     Income Taxes
     The Company  recognizes  deferred tax assets and  liabilities for temporary
     differences  between the financial reporting basis and the tax basis of the
     Company's  assets and  liabilities  and expected  benefits of utilizing net
     operating  loss  carryforwards.  The impact on deferred taxes of changes in
     tax rates and laws,  if any,  applied to the years during  which  temporary
     differences are expected to be settled,  are reflected in the  consolidated
     financial statements in the period of enactment.

     Derivative Financial Instruments
     The Company uses derivative financial instruments,  including interest rate
     exchange  agreements  ("Swaps"),  interest rate cap agreements ("Caps") and
     interest  rate collar  agreements  ("Collars"),  to manage its  exposure to
     fluctuations  in interest rates.  Swaps,  Caps and Collars are matched with
     either fixed or variable  rate debt and periodic  cash payments are accrued
     on a settlement  basis as an adjustment to interest  expense.  Any premiums
     associated  with  these  instruments  are  amortized  over  their  term and
     realized gains or losses as a result of the  termination of the instruments
     are deferred and amortized over the remaining term of the underlying  debt.
     Unrealized gains and losses as a result of these instruments are recognized
     when the underlying hedged item is extinguished or otherwise terminated.

     Those  instruments  that have been  entered  into by the  Company  to hedge
     exposure to interest rate risk are periodically  examined by the Company to
     ensure that the instruments are marked with underlying liabilities,  reduce
     the Company's risks relating to interest rates,  and,  through market value
     and  sensitivity  analysis,  maintain a high  correlation  to the  interest
     expense  of the hedged  item.  For those  instruments  that do not meet the
     above criteria,  variations in their fair value are  marked-to-market  on a
     current basis in the Company's consolidated statement of operations.

     The Company does not hold or issue any derivative financial instruments for
     trading purposes and is not a party to leveraged  instruments (see Note 4).
     The  credit  risks  associated  with  the  Company's  derivative  financial
     instruments  are  controlled  through the  evaluation and monitoring of the
     creditworthiness of the counterparties. Although the Company may be exposed
     to losses in the event of nonperformance by the counterparties, the Company
     does not expect such losses, if any, to be significant.

                                     - 26 -
<PAGE>
COMCAST CABLE COMMUNICATIONS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996 (Continued)


     New Accounting Pronouncement
     In June 1998, the Financial Accounting Standards Board issued SFAS No. 133,
     "Accounting  for  Derivative  Instruments  and  Hedging  Activities."  This
     statement,   which  establishes  accounting  and  reporting  standards  for
     derivatives and hedging activities, is effective for fiscal years beginning
     after June 15, 1999. Upon the adoption of SFAS No. 133, all derivatives are
     required to be recognized in the statement of financial  position as either
     assets or liabilities and measured at fair value.  The Company is currently
     evaluating  the  impact  the  adoption  of SFAS No.  133  will  have on its
     financial position and results of operations.

     Reclassifications
     Certain  reclassifications  have been made to the prior years' consolidated
     financial statements to conform to those classifications used in 1998.

3.   ACQUISITIONS

     Jones Intercable
     In September  1998,  Comcast  determined  that it would  contribute,  via a
     capital contribution to the Company, all of the shares in Jones Intercable,
     Inc.  ("Jones  Intercable")  to be  acquired  by Comcast  from BCI  Telecom
     Holding  and  affiliates  of Glenn R. Jones (the  "Jones  Acquisition")  in
     transactions  previously  announced  by Comcast.  The shares to be acquired
     consist of an  aggregate  of  approximately  12.8  million  shares of Jones
     Intercable  Class A Common Stock and  approximately  2.9 million  shares of
     Jones   Intercable   Common  Stock  (the  "Common   Stock"),   representing
     approximately  37% of the economic and 47% of the voting  interest in Jones
     Intercable.  In  addition,  the 2.9  million  shares of Common  Stock  will
     represent  approximately 57% of the outstanding Common Stock which class of
     stock  elects  75% of the  Board  of  Directors  of Jones  Intercable.  The
     transaction  will be funded  either  with new  borrowings,  with  available
     borrowings  under  existing  lines  of  credit  or by  other  means.  Jones
     Intercable  is a public  company,  which upon  closing  of certain  pending
     transactions, will own or manage cable operations serving approximately 1.0
     million customers.

     The  contribution,  which is subject to the receipt of required  regulatory
     and other approvals, will be effective immediately following closing of the
     Jones Acquisition, which is expected to occur in the first half of 1999. As
     a  result,  Jones  Intercable  will  become a  consolidated  public-company
     subsidiary of the Company.

     Scripps Cable
     In  November  1996,  Comcast  acquired  the  cable  television   operations
     ("Scripps Cable") of The E.W. Scripps Company ("E.W.  Scripps") in exchange
     for  approximately  93.0 million shares of Comcast's Class A Special Common
     Stock  valued  at  $1.552  billion  (the  "Scripps  Acquisition").  Comcast
     accounted for the Scripps Acquisition under the purchase method.  Following
     the Scripps  Acquisition,  Comcast contributed Scripps Cable to the Company
     (the "Scripps  Contribution")  at Comcast's  historical  cost.  The Scripps
     Contribution was recorded as an increase in additional  capital and Scripps
     Cable was consolidated with the Company effective  November 1, 1996. As the
     Scripps  Contribution  was a non-cash  transaction,  it had no  significant
     impact on the Company's consolidated statement of cash flows.


                                     - 27 -

<PAGE>
COMCAST CABLE COMMUNICATIONS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996 (Continued)


     Unaudited Pro Forma Information
     The following  unaudited pro forma  information for the year ended December
     31, 1996 has been presented as if the Scripps  Contribution had occurred on
     January  1,  1996.  This  unaudited  pro  forma  information  is  based  on
     historical results of operations adjusted for acquisition costs and, in the
     opinion of management,  is not  necessarily  indicative of what the results
     would have been had the Company  operated  Scripps  Cable since  January 1,
     1996 (dollars in millions):

     Service income...................................          $1,893.8
     Loss before extraordinary items..................            (118.3)
     Net loss.........................................            (118.3)

4.   LONG-TERM DEBT
<TABLE>
<CAPTION>
                                                                                             December 31,
                                                                                        1998              1997
                                                                                          (Dollars in millions)
<S>                                                                                    <C>              <C>     
     Notes payable to banks and insurance companies,
         due in installments through 2003.......................................         $972.0           $915.7
     8 1/8% Senior notes, due 2004..............................................          299.8            299.7
     8 3/8% Senior notes, due 2007..............................................          596.5            596.3
     6.20% Senior notes, due 2008...............................................          797.9
     8 7/8% Senior notes, due 2017..............................................          545.6            545.5
     8 1/2% Senior notes, due 2027..............................................          249.6            249.6
     Other debt, due in installments principally through 2007...................            0.8              0.9
                                                                                       --------         --------
                                                                                        3,462.2          2,607.7
     Less current portion.......................................................            0.1             52.8
                                                                                       --------         --------
                                                                                       $3,462.1         $2,554.9
                                                                                       ========         ========
</TABLE>

     Maturities of long-term  debt  outstanding  as of December 31, 1998 for the
     four years after 1999 are as follows (dollars in millions):

         2000.................................................        72.1
         2001.................................................       209.4
         2002.................................................       231.3
         2003.................................................       459.5

     In addition to the Company's outstanding long-term debt as presented in the
     table  above,  the Company had an  aggregate  of $134.6  million and $695.2
     million of notes  payable  to  Comcast  and  Comcast's  subsidiaries  as of
     December 31, 1998 and 1997, respectively (see Note 5).

     Senior Notes
     In November  1998,  the Company  sold $800.0  million  aggregate  principal
     amount of 6.20% senior notes due 2008. The Company used  substantially  all
     of the net proceeds  from the offering to repay  existing  notes payable to
     affiliates (see Note 5) and for general purposes.

     Interest  on all of the  Senior  Notes is payable  semiannually  in May and
     November of each year.  The 6.20%  Senior  Notes are  redeemable  only upon
     maturity on November 15, 2008, the 8 1/2% Senior Notes are  redeemable,  in
     whole or in part,  at the  option of the  Company  at any time after May 1,
     2009, and the remaining  Senior Notes are redeemable,  in whole or in part,
     at the option of the Company at any time.  In each case,  the Senior  Notes
     are  redeemable  at a price  equal  to the  greater  of (i)  100% of  their
     principal amount,  plus accrued interest thereon to the date of redemption,
     or (ii) the sum of the present values of the remaining  scheduled  payments
     of principal and

                                     - 28 -
<PAGE>
COMCAST CABLE COMMUNICATIONS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996 (Continued)


     interest thereon discounted to the date of redemption on a semiannual basis
     at the Adjusted  Treasury Rate (as defined),  plus accrued  interest on the
     Senior  Notes to the date of  redemption.  Each holder of the 8 1/2% Senior
     Notes may require the Company to repurchase  all or a portion of the 8 1/2%
     Senior Notes owned by such holder on May 1, 2009 at a purchase  price equal
     to 100% of the principal amount thereof.

     The  Senior  Notes are  unsecured  and  unsubordinated  obligations  of the
     Company  and rank pari passu with all other  unsecured  and  unsubordinated
     indebtedness  and other  obligations  of the Company.  The Senior Notes are
     effectively  subordinated to all liabilities of the Company's subsidiaries,
     including trade payables.

     The  indenture  for  the  Senior  Notes,   among  other  things,   contains
     restrictions  (with certain  exceptions)  on the ability of the Company and
     its Restricted  Subsidiaries (as defined) to: (i) make dividend payments or
     other  restricted  payments;  (ii)  create  liens  or enter  into  sale and
     leaseback transactions;  and (iii) enter into mergers,  consolidations,  or
     sales of all or substantially all of their assets.

     Extraordinary Items
     In connection with the  refinancing,  redemption and optional  repayment of
     certain  indebtedness,  the Company  expensed  unamortized debt acquisition
     costs and incurred debt extinguishment costs of $27.1 million, resulting in
     extraordinary  losses,  net of tax, of $16.7 million  during the year ended
     December 31, 1997.

     Interest Rates
     The fixed interest rate on notes payable to insurance companies was 8.6% as
     of December 31, 1998.  Bank debt interest rates vary based upon one or more
     of the following rates at the option of the Company:

          Base Rate  (higher of federal  funds rate plus 0.5% or prime  rate) to
          Base Rate plus 0.75%;
          London  Interbank  Offered  Rate  ("LIBOR")  plus 0.375% to LIBOR plus
          1.75%

     As of December 31, 1998 and 1997, the Company's  effective weighted average
     interest rate on its  outstanding  variable rate notes payable to banks was
     6.08% and 6.97%, respectively.

     Interest Rate Risk Management
     The Company is exposed to market risk including  changes in interest rates.
     To manage the volatility  relating to these  exposures,  the Company enters
     into various derivative  transactions pursuant to the Company's policies in
     areas such as counterparty  exposure and hedging  practices.  Positions are
     monitored using techniques including market value and sensitivity analyses.

     The use of interest rate risk management  instruments,  such as Swaps, Caps
     and  Collars,  is  required  under the terms of  certain  of the  Company's
     outstanding  debt  agreements.  The Company's  policy is to manage interest
     costs using a mix of fixed and variable rate debt. Using Swaps, the Company
     agrees to exchange,  at specified  intervals,  the difference between fixed
     and variable  interest  amounts  calculated by reference to an  agreed-upon
     notional principal amount. Caps are used to lock in a maximum interest rate
     should  variable  rates rise, but enable the Company to otherwise pay lower
     market rates.  Collars  limit the  Company's  exposure to and benefits from
     interest rate  fluctuations on variable rate debt to within a certain range
     of rates.

                                     - 29 -
<PAGE>
COMCAST CABLE COMMUNICATIONS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996 (Continued)


     The following table  summarizes the terms of the Company's  existing Swaps,
     Caps and Collars as of December 31, 1998 and 1997 (dollars in millions):
<TABLE>
<CAPTION>
                                                           Notional                      Average       Estimated
                                                            Amount     Maturities     Interest Rate    Fair Value
<S>                                                        <C>         <C>               <C>           <C>   
     As of December 31, 1998
     Variable to Fixed Swaps.........................        $50.0       1999              5.7%          ($0.1)
     Caps............................................        240.0       1999              7.0%
     Collar..........................................         50.0       2000            6.3%/4.0%

     As of December 31, 1997
     Variable to Fixed Swaps.........................       $100.0     1998-1999           5.7%             $0.1
     Caps............................................        150.0       1998              6.7%
     Collar..........................................         50.0       1998            7.0%/4.9%           0.2
</TABLE>

     The  notional  amounts of interest  rate  instruments,  as presented in the
     above table, are used to measure interest to be paid or received and do not
     represent the amount of exposure to credit loss.  The estimated  fair value
     approximates  the  proceeds  (costs) to settle the  outstanding  contracts.
     While Swaps,  Caps and Collars  represent an integral part of the Company's
     interest rate risk management program, their incremental effect on interest
     expense  for the  years  ended  December  31,  1998,  1997 and 1996 was not
     significant.

     Estimated Fair Value
     The Company's  long-term  debt had estimated  fair values of $3.766 billion
     and $2.862  billion as of  December  31, 1998 and 1997,  respectively.  The
     estimated fair value of the Company's  publicly traded debt is based on the
     quoted  market  price for that  debt.  Interest  rates  that are  currently
     available  to the  Company  for  issuance  of debt with  similar  terms and
     remaining  maturities  are used to estimate  fair value for debt issues for
     which quoted market prices are not available.

     Debt Covenants
     Certain of the Company's  subsidiaries' loan agreements contain restrictive
     covenants which,  among other things,  limit the Company's ability to enter
     into  arrangements  for the  acquisition  or  disposition  of property  and
     equipment,  investments,  mergers and the  incurrence of  additional  debt.
     Certain  of these  agreements  require  that  certain  ratios and cash flow
     levels be maintained and contain certain restrictions on dividend payments,
     payment of management fees and advances of funds to affiliated entities and
     the Company.  The Company and its subsidiaries were in compliance with such
     restrictive covenants for all periods presented.  In addition, the stock of
     certain   subsidiary   companies  is  pledged  as  collateral   for  unused
     irrevocable standby letters of credit on behalf of affiliates.

     As of December 31, 1998, a portion of the Company's cash, cash equivalents,
     short-term  investments  and cash held by an affiliate is restricted to use
     by subsidiaries of the Company under  contractual  arrangements,  including
     subsidiary credit agreements.

     Restricted net assets of the Company's subsidiaries were approximately $2.9
     billion as of December 31, 1998. The restricted net assets of  subsidiaries
     exceeds the Company's  consolidated  net assets as certain of the Company's
     subsidiaries have a stockholder's deficiency.

     Lines and Letters of Credit
     As of December 31,  1998,  certain  subsidiaries  of the Company had unused
     lines of credit of $703.0 million, $103.0 million of which is restricted by
     the  covenants of the related debt  agreements  and to  subsidiary  general
     purposes and dividend declaration.

     As of December  31, 1998 the  Company and certain of its  subsidiaries  had
     unused irrevocable standby letters of credit totaling $2.3 million to cover
     potential fundings associated with several projects.

                                     - 30 -
<PAGE>
COMCAST CABLE COMMUNICATIONS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996 (Continued)


5.   NOTES PAYABLE TO AFFILIATES

     As of December 31, 1998 and 1997,  notes payable to affiliates  (the "Notes
     Payable")  include $130.7 million and $670.6  million  principal  amount of
     Notes Payable to Comcast and certain of its wholly owned  subsidiaries.  As
     of December  31,  1998 and 1997,  accrued  interest  relating to such Notes
     Payable of $3.9 million and $24.6 million,  respectively,  was added to the
     principal.  The Notes  Payable bear interest at rates ranging from 7.25% to
     9.25% as of December 31, 1998 (weighted  average interest rate of 7.73% and
     7.71% as of December 31, 1998 and 1997) and are due in 2002.

6.   RELATED PARTY TRANSACTIONS

     Comcast, on behalf of the Company,  has an affiliation  agreement with QVC,
     Inc. ("QVC"),  an electronic  retailer and a majority-owned  and controlled
     subsidiary of Comcast, to carry its programming. In return for carrying QVC
     programming,  the Company receives an allocated portion,  based upon market
     share,  of a percentage of net sales of  merchandise  sold to QVC customers
     located in the  Company's  service area.  For the years ended  December 31,
     1998,  1997 and 1996, the Company's  service income includes $13.3 million,
     $10.2 million and $8.3 million, respectively, relating to QVC.

     Comcast,  through  management  agreements,  manages the  operations  of the
     Company's  subsidiaries,  including  rebuilds and upgrades.  The management
     agreements generally provide that Comcast will supervise the management and
     operations  of the cable  systems and arrange  for and  supervise  (but not
     necessarily   perform  itself)   certain   administrative   functions.   As
     compensation  for such  services,  the  agreements  provide  for Comcast to
     charge  management fees of up to 6% of gross revenues.  Comcast charged the
     Company's  subsidiaries  management fees of $130.4 million,  $119.7 million
     and $93.2 million in 1998, 1997 and 1996,  respectively.  These  management
     fees are included in selling,  general and  administrative  expenses in the
     Company's  consolidated  statement  of  operations.  Comcast  has agreed to
     permit certain subsidiaries of the Company to defer payment of a portion of
     these  expenses with the deferred  portion being treated as a  subordinated
     long-term  liability  due to  affiliate  which  will not be paid  until the
     subsidiaries'  existing long-term debt is retired. In addition,  payment of
     certain of these  expenses has been deferred  until the  California  Public
     Employees'  Retirement  System  ("CalPERS")  no longer has an  interest  in
     Comcast MHCP Holdings,  L.L.C.  (the "LLC"), a majority owned subsidiary of
     the Company (see Note 9).  Management  fees deferred in 1998, 1997 and 1996
     were $5.5 million,  $4.7 million and $4.3 million,  respectively.  Deferred
     management  fees were $142.4  million and $136.9 million as of December 31,
     1998 and 1997, respectively.

     On behalf of the Company,  Comcast seeks and secures long-term  programming
     contracts that generally  provide for payment based on either a monthly fee
     per subscriber per channel or a percentage of certain subscriber  revenues.
     Comcast  charges each of the Company's  subsidiaries  for  programming on a
     basis which  generally  approximates  the amount that each such  subsidiary
     would  be  charged  if it  purchased  such  programming  directly  from the
     supplier,  subject to  limitations  imposed by debt  facilities for certain
     subsidiaries,  and did not benefit from the  purchasing  power of Comcast's
     consolidated  operations.  Amounts  charged to the  Company by Comcast  for
     programming (the "Programming  Charges") are included in operating expenses
     in  the  Company's  consolidated  statement  of  operations.   The  Company
     purchases  certain  other  services,   including   insurance  and  employee
     benefits,  from  Comcast  under  cost-sharing  arrangements  on terms  that
     reflect Comcast's actual cost. The Company  reimburses  Comcast for certain
     other costs  (primarily  salaries) under  cost-reimbursement  arrangements.
     Under all of these  arrangements,  the Company  incurred  total expenses of
     $760.9  million,  $674.6  million  and  $505.0  million,  including  $640.5
     million, $560.9 million and $417.0 million of Programming Charges, in 1998,
     1997 and 1996, respectively. The Programming Charges include $59.4 million,
     $49.0  million  and $26.2  million  in 1998,  1997 and 1996,  respectively,
     relating to programming  purchased by the Company,  through  Comcast,  from
     suppliers in which Comcast holds an equity interest.

                                     - 31 -
<PAGE>
COMCAST CABLE COMMUNICATIONS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996 (Continued)


     Comcast has agreed to permit certain of the Company's subsidiaries to defer
     payment of a portion of the Programming  Charges with the deferred  portion
     being treated as a subordinated  long-term liability due to affiliate which
     will not be payable  until the  subsidiaries'  existing  long-term  debt is
     retired.  In addition,  payment of certain of the  Programming  Charges has
     been  deferred  until  CalPERS  no  longer  has an  interest  in  the  LLC.
     Programming  Charges  deferred in 1998,  1997 and 1996 were $120.5 million,
     $102.3  million  and  $62.3  million,  respectively.  Deferred  Programming
     Charges were $382.4  million and $261.9 million as of December 31, 1998 and
     1997, respectively.

     Current due to  affiliates  in the  Company's  consolidated  balance  sheet
     primarily  consists of amounts due to Comcast and its affiliates  under the
     cost-sharing  arrangements  described  above and amounts payable to Comcast
     and its  affiliates  as  reimbursement  for payments  made, in the ordinary
     course of business, by such affiliates on behalf of the Company.

     The Company has entered into a custodial  account  arrangement with Comcast
     Financial  Agency  Corporation  ("CFAC"),  a  wholly  owned  subsidiary  of
     Comcast, under which CFAC provides cash management services to the Company.
     Under this arrangement,  the Company's cash receipts are deposited with and
     held by CFAC,  as custodian and agent,  which  invests and  disburses  such
     funds at the  direction of the  Company.  As of December 31, 1998 and 1997,
     $57.1 million and $56.6  million,  respectively,  of the Company's cash was
     held by  CFAC.  These  amounts  have  been  classified  as cash  held by an
     affiliate in the Company's  consolidated  balance  sheet.  During the years
     ended December 31, 1998, 1997 and 1996, the Company  recognized  investment
     income of $3.1  million,  $3.9 million and $4.1 million,  respectively,  on
     cash held by CFAC.

7.   INCOME TAXES

     The Company and its 80% or more owned subsidiaries (the "Cable Consolidated
     Group")  join with  Comcast  in filing a  consolidated  federal  income tax
     return.  Comcast  allocates income tax expense or benefit to the Company as
     if the Company  was filing a separate  federal  income tax return.  Comcast
     Communications  Properties,   Inc.  ("CCP"),  an  indirect  majority  owned
     subsidiary of the Company, files a separate consolidated federal income tax
     return. Tax benefits from both losses and tax credits are made available to
     the Company as it is able to realize  such  benefits  on a separate  return
     basis.  The Company  pays  Comcast for income  taxes an amount equal to the
     amount of tax it would pay if it filed a separate tax return.

     The LLC is treated as a partnership  for income tax purposes.  As such, any
     taxable  income or loss  attributable  to the LLC,  excluding any income or
     loss from its subsidiaries,  flows through to the Company and CalPERS based
     on their respective ownership percentages.

     Income  tax  benefit  consists  of the  following  components  (dollars  in
     millions):
<TABLE>
<CAPTION>

                                                                             Year Ended December 31,
                                                                     1998             1997              1996
<S>                                                                 <C>          <C>                   <C>
     Current expense
     Federal..............................................            $1.9            $                 $32.8
     State................................................             5.4               6.1              7.3
                                                                    ------            ------            ----- 
                                                                       7.3               6.1             40.1
                                                                    ------            ------            ----- 
     Deferred (benefit) expense
     Federal..............................................           (41.1)            (48.2)           (48.3)
     State................................................            (2.0)             (1.5)             3.7
                                                                    ------            ------            ----- 
                                                                     (43.1)            (49.7)           (44.6)
                                                                    ------            ------            ----- 
     Income tax benefit...................................          ($35.8)           ($43.6)           ($4.5)
                                                                    ======            ======            ===== 
</TABLE>

                                     - 32 -

<PAGE>
COMCAST CABLE COMMUNICATIONS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996 (Continued)


     The effective  income tax benefit of the Company differs from the statutory
     amount because of the effect of the following items (dollars in millions):

<TABLE>
<CAPTION>
                                                                             Year Ended December 31,
                                                                     1998             1997              1996
<S>                                                                 <C>               <C>              <C>    
     Federal tax at statutory rate........................          ($52.5)           ($61.8)          ($17.1)
     Non-deductible depreciation and amortization.........            21.5              21.5             12.5
     State income taxes, net of federal benefit...........             2.2               3.1              7.2
     Interest income, taxable to CalPERS..................            (7.5)             (6.7)            (5.9)
     Other................................................              .5               0.3             (1.2)
                                                                    ------            ------           ------ 
     Income tax benefit...................................          ($35.8)           ($43.6)           ($4.5)
                                                                    ======            ======           ====== 
</TABLE>

     Deferred income tax benefit resulted from the following differences between
     financial and income tax reporting (dollars in millions):

<TABLE>
<CAPTION>
                                                                             Year Ended December 31,
                                                                     1998             1997              1996
<S>                                                                 <C>               <C>              <C>    
     Depreciation and amortization........................          ($65.0)           ($87.5)          ($54.9)
     Accrued expenses not currently deductible............                                               (1.0)
     Deductible costs accrued in prior years..............             1.2               2.8              6.5
     Temporary differences associated
         with sale or exchange of securities..............             3.0              (6.9)             6.9
     Change in net operating loss carryforwards...........            22.8              44.6             (4.4)
     Change in valuation allowance and other..............            (5.1)             (2.7)             2.3
                                                                    ------            ------           ------ 
     Deferred income tax benefit..........................          ($43.1)           ($49.7)          ($44.6)
                                                                    ======            ======           ====== 
</TABLE>

     Significant  components  of the Company's net deferred tax liability are as
     follows (dollars in millions):
<TABLE>
<CAPTION>
                                                                                           December 31,
                                                                                      1998              1997
<S>                                                                                 <C>              <C>     
     Deferred tax assets:
         Net operating loss carryforwards.......................................      $110.1           $132.9
         Less valuation allowance...............................................       (95.6)           (97.5)
                                                                                    --------         --------
                                                                                        14.5             35.4
                                                                                    --------         --------
     Deferred tax liabilities, principally differences between book
         and tax basis of property and equipment and deferred charges...........     1,461.5          1,523.8
                                                                                    --------         --------
         Net deferred tax liability.............................................    $1,447.0         $1,488.4
                                                                                    ========         ========
</TABLE>

     The Company's  valuation  allowance  against  deferred tax assets  includes
     approximately $60.0 million for which any subsequent tax benefit recognized
     will be  allocated  to  reduce  goodwill  and other  noncurrent  intangible
     assets.  For income tax reporting  purposes,  CCP has a net operating  loss
     carryforward of approximately  $40.0 million for which a deferred tax asset
     has been recorded and which expires through 2018.

                                     - 33 -
<PAGE>
COMCAST CABLE COMMUNICATIONS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996 (Continued)


8.   STATEMENT OF CASH FLOWS-SUPPLEMENTAL INFORMATION

     The Company made cash payments for interest on its long-term debt of $214.4
     million,  $225.4  million  and  $214.4  million  in 1998,  1997  and  1996,
     respectively.  The Company  made cash  payments  for  interest on the Notes
     Payable of $70.5 million, $17.7 million and $25.6 million in 1998, 1997 and
     1996, respectively.

     The Company made cash payments to Comcast for federal income taxes of $32.9
     million and $19.9 million in 1997 and 1996, respectively.  The Company made
     cash payments to the respective  state taxing  authorities for state income
     taxes of $5.4  million,  $7.0  million and $6.6  million in 1998,  1997 and
     1996, respectively.

9.   COMMITMENTS AND CONTINGENCIES

     Commitments  
     At any time after  December  18, 2001,  CalPERS may elect to liquidate  its
     interest in the LLC, a 55% owned indirect  subsidiary of the Company (which
     holds  cable   communications   systems   serving   approximately   644,000
     subscribers  as of December 31, 1998) in which  CalPERS owns the  remaining
     45% interest,  at a price based upon the fair value of CalPERS' interest in
     the LLC, adjusted,  under certain  circumstances,  for certain  performance
     criteria  relating  to the  fair  value of the LLC or to  Comcast's  common
     stock. Except in certain limited circumstances, Comcast, at its option, may
     satisfy this  liquidity  arrangement  by purchasing  CalPERS'  interest for
     cash, by issuing its common stock  (subject to certain  limitations)  or by
     selling the LLC.

     In December  1996,  an indirect  majority  owned  subsidiary of the Company
     entered into an operating lease agreement granting certain rights of use of
     certain  non-cable  assets to the  counterparty for a period of five years,
     subject to certain  conditions.  Pursuant  to this  agreement,  the Company
     received  an  advance  payment  of $17.0  million,  representing  the total
     minimum lease  payments to be received over the lease term. The Company has
     recorded this amount in other  long-term  liabilities  in its  consolidated
     balance  sheet and is  amortizing  such  amount to service  income over the
     lease term on a straight-line basis.

     Minimum  annual rental  commitments  for office space and  equipment  under
     noncancelable operating leases are as follows (dollars in millions):

              1999.............................................      $8.7
              2000.............................................       7.5
              2001.............................................       6.6
              2002.............................................       5.5
              2003.............................................       4.7
              Thereafter.......................................      14.4

     Pole  rentals  have  been  excluded  from the  above  schedule  as they are
     generally cancelable after an initial period by either party upon notice.

     Rental expense (including pole rentals) of $23.8 million, $22.6 million and
     $19.7  million  has been  charged  to  operations  in 1998,  1997 and 1996,
     respectively.

     Contingencies
     The Company is subject to legal  proceedings  and claims which arise in the
     ordinary course of its business.  In the opinion of management,  the amount
     of ultimate  liability  with respect to these  actions will not  materially
     affect the  financial  position,  results of operations or liquidity of the
     Company.

     The  Federal  Communications  Commission  and the  Company  entered  into a
     "social  contract" in which the Company has  committed to complete  certain
     system  upgrades and  improvements by March 31, 1999 in return for which it

                                     - 34 -
<PAGE>
COMCAST CABLE COMMUNICATIONS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996 (Concluded)

     was able,  after  December 31, 1997, to move a limited number of previously
     regulated   programming   services  in  certain  cable   franchises  to  an
     unregulated new product tier.

     In June 1998,  the  Department  of Public  Utility  Control of the State of
     Connecticut  issued an Amended  Decision  resolving a dispute pending since
     1994 involving basic service rates and equipment and  installation  charges
     for  certain of the  Company's  cable  systems in the  State.  The  Amended
     Decision provides for refunds of approximately $1.8 million over a one-year
     period to subscribers and establishes maximum permitted basic service rates
     and equipment and installation charges through March 31, 1999.

                                     - 35 -
<PAGE>
ITEM 9    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
          FINANCIAL DISCLOSURE

     Not applicable.

                                    PART III

The information  called for by Item 10, Directors and Executive  Officers of the
Registrant,  Item 11,  Executive  Compensation,  Item 12, Security  Ownership of
Certain Beneficial Owners and Management, and Item 13, Certain Relationships and
Related  Transactions,  is omitted pursuant to SEC General Instruction I of Form
10-K.


                                     - 36 -
<PAGE>

                                     PART IV

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

     (a) The following consolidated financial statements of ours are included in
Part II, Item 8:

          Independent Auditors' Report......................................19
          Consolidated Balance Sheet--December 31, 1998 and 1997............20
          Consolidated Statement of Operations--Years
            Ended December 31, 1998, 1997 and 1996..........................21
          Consolidated Statement of Cash Flows--Years
            Ended December 31, 1998, 1997 and 1996..........................22
          Consolidated Statement of Stockholder's Equity
            (Deficiency)--Years Ended December 31, 1998, 1997 and 1996......23
          Notes to Consolidated Financial Statements........................24

     (b) (i)  The following  financial  statement schedules required to be filed
              by Items 8 and 14(d) of Form 10-K are included in Part IV:

              Schedule I - Condensed Financial Information of Registrant 
                           Unconsolidated (Parent Only)
              Schedule II - Valuation and Qualifying Accounts

              All other  schedules are omitted  because they are not applicable,
              not  required  or the  required  information  is  included  in the
              consolidated financial statements or notes thereto.

     (c) Reports on Form 8-K

         (i)  We filed a Current Report on Form 8-K under Item 5 on November 10,
              1998 relating to our unaudited financial position and the results
              of operations for the nine and three months ended September 30,
              1998.

     (d) Exhibits required to be filed by Item 601 of Regulation S-K:

         3.1       Certificate of Incorporation filed on April 2, 1981
                   (incorporated by reference to Exhibit 3.1(a) to our
                   Registration Statement on Form S-4, as amended, filed on
                   September 22, 1997).

         3.2       By-laws (incorporated by reference to Exhibit 3.2 to our
                   Registration Statement on Form S-4, as amended, filed on
                   September 22, 1997).

         4.1(a)    Indenture dated as of May 1, 1997 by and between Comcast
                   Cable Communications, Inc. and Bank of Montreal Trust Company
                   (incorporated by reference to Exhibit 4.1(a) to our
                   Registration Statement on Form S-4, as amended, filed on
                   September 22, 1997).

         4.1(b)    Form of Notes relating to our 8 1/8% Senior Notes due 2004,
                   8 3/8% Senior Notes due 2007, 6.20% Senior Notes due 2008,
                   8 7/8% Senior Notes due 2017 and 8 1/2% Senior Notes due 2027
                   (incorporated by reference to Exhibit 4.1(b) to the Company's
                   Registration Statement on Form S-4, as amended, filed on
                   September 22, 1997).

         10.1      Tax Sharing Agreement, dated as of December 2, 1992, among
                   Storer Communications, Inc., TKR Cable I, Inc., TKR Cable II,
                   Inc., TKR Cable III, Inc., Tele-Communications, Inc., Comcast
                   Corporation and each of the Departing Subsidiaries that are
                   signatories thereto (incorporated by reference to Exhibit 4
                   to Comcast Corporation's Current Report on Form 8-K filed on
                   December 17, 1992, as amended by Form 8 filed January 8,
                   1993).

         10.2      Tax Sharing Agreement, dated December 2, 1992, between
                   Comcast Corporation and Comcast Storer, Inc. (incorporated by
                   reference to Exhibit 9 to Comcast Corporation's Current
                   Report on Form 8-K filed on December 17, 1992, as amended by
                   Form 8 filed January 8, 1993).

         10.3      Comcast MHCP Holdings, L.L.C. Amended and Restated Limited
                   Liability Company Agreement, dated as of December 18, 1994,
                   among the Comcast Cable Communications, Inc., The California
                   Public Employees' Retirement System and, for certain limited
                   purposes, Comcast 

                                     - 37 -
<PAGE>

                   Corporation (incorporated by reference to Exhibit 10.1 to
                   Comcast Corporation's Current Report on Form 8-K filed on
                   January 6, 1995).

         10.4      Credit Agreement, dated as of December 22, 1994, among
                   Comcast MH Holdings, Inc., the banks listed therein, The
                   Chase Manhattan Bank (National Association), NationsBank of
                   Texas, N.A. and the Toronto-Dominion Bank, as Arranging
                   Agents, The Bank of New York, The Bank of Nova Scotia,
                   Canadian Imperial Bank of Commerce and Morgan Guaranty Trust
                   Company of New York, as Managing Agents and NationsBank of
                   Texas, N.A., as Administrative Agent (incorporated by
                   reference to Exhibit 10.2 to Comcast Corporation's Current
                   Report on Form 8- K filed on January 6, 1995).

         10.5      Pledge Agreement, dated as of December 22, 1994, between
                   Comcast MH Holdings, Inc. and NationsBank of Texas, N.A., as
                   the secured party (incorporated by reference to Exhibit 10.3
                   to Comcast Corporation's Current Report on Form 8-K filed on
                   January 6, 1995).

         10.6      Pledge Agreement dated as of December 22, 1994, between
                   Comcast Communications Properties, Inc. and NationsBank of
                   Texas, N.A., as the Secured Party (incorporated by reference
                   to Exhibit 10.4 to Comcast Corporation's Current Report on
                   Form 8-K filed on January 6, 1995).

         10.7      Affiliate Subordination Agreement (as the same may be
                   amended, modified, supplemented, waived, extended or restated
                   from time to time, this "Agreement"), dated as of December
                   22, 1994, among Comcast Corporation, Comcast MH Holdings,
                   Inc. (the "Borrower"), any affiliate of the Borrower that
                   shall have become a party thereto and NationsBank of Texas,
                   N.A., as Administrative Agent under the Credit Agreement
                   dated as of December 22, 1994, among the Borrower, the Banks
                   listed therein, The Chase Manhattan Bank (National
                   Association), NationsBank of Texas, N.A. and The
                   Toronto-Dominion Bank, as Arranging Agents. The Bank of New
                   York, The Bank of Nova Scotia, Canadian Imperial Bank of
                   Commerce and Morgan Guaranty Trust Company of New York, as
                   Managing Agents, and the Administrative Agent (incorporated
                   by reference to Exhibit 10.5 to Comcast Corporation's Current
                   Report on Form 8- K filed on January 6, 1995).

         10.8      Registration Rights and Price Protection Agreement, dated as
                   of December 22, 1994, by and between Comcast Corporation and
                   The California Public Employees' Retirement System
                   (incorporated by reference to Exhibit 10.8 to Comcast
                   Corporation's Current Report on Form 8- K filed on January 6,
                   1995).

         10.9      Management Agreement, dated as of April 24, 1997, between
                   Comcast Cable Communications, Inc. and Comcast Corporation
                   (incorporated by reference to Exhibit 10.11 to our
                   Registration Statement on Form S-4, as amended, filed on
                   September 22, 1997).

         10.10     Promissory Note, dated as of July 2, 1997, between Comcast
                   Cable Communications, Inc. and Comcast Corporation
                   (incorporated by reference to Exhibit 10.13 to our
                   Registration Statement on Form S-4, as amended, filed on
                   September 22, 1997).

         10.11     Credit Agreement, dated as of November 15, 1996, among
                   Comcast SCH Holdings, Inc., the banks listed therein,
                   Nationsbank of Texas, N.A., as Documentation Agent, The Chase
                   Manhattan Bank, as Syndication Agent, The Bank of New York,
                   The Chase Manhattan Bank and Nationsbank of Texas, N.A., as
                   Managing Agents, and The Bank of New York, as Administrative
                   Agent (incorporated by reference to Exhibit 10.35 to Comcast
                   Corporation's Form 10-K filed on March 3, 1998).

         12.1      Statement re: Computation of Ratio of Earnings to Fixed
                   Charges.

         23.1      Consent of Deloitte & Touche LLP.

         27.1      Financial Data Schedule.

                                     - 38 -

<PAGE>
                                   SIGNATURES

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  the  Registrant  has duly  caused  this report to be signed on its
behalf  by  the   undersigned,   thereunto  duly  authorized  in   Philadelphia,
Pennsylvania on March 19, 1999.

                                         Comcast Cable Communications, Inc.



                                         By: /s/ Brian L. Roberts
                                             -----------------------------------
                                             Brian L. Roberts
                                             Vice Chairman and Director

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.

SIGNATURE                         TITLE                                 DATE

/s/ Ralph J. Roberts
-----------------------
Ralph J. Roberts          Chairman; Director                      March 19, 1999


/s/ Julian A. Brodsky
-----------------------
Julian A. Brodsky         Vice Chairman; Director                 March 19, 1999


/s/ Brian L. Roberts
-----------------------
Brian L. Roberts          Vice Chairman; Director (Principal      March 19, 1999
                          Executive Officer)

/s/ Lawrence S. Smith
-----------------------
Lawrence S. Smith         Executive Vice President                March 19, 1999
                          (Principal Accounting Officer)

/s/ John R. Alchin
-----------------------
John R. Alchin            Senior Vice President, Treasurer        March 19, 1999
                          (Principal Financial Officer)

/s/ Stanley L. Wang
-----------------------
Stanley L. Wang           Senior Vice President, Secretary;       March 19, 1999
                          Director



                                     - 39 -
<PAGE>
               COMCAST CABLE COMMUNICATIONS, INC. AND SUBSIDIARIES

                 SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF

                     REGISTRANT UNCONSOLIDATED (PARENT ONLY)

                             CONDENSED BALANCE SHEET

                    (Dollars in millions, except share data)
<TABLE>
<CAPTION>

                                                                                               December 31,
                                                                                           1998             1997
<S>                                                                                      <C>              <C>
ASSETS
CURRENT ASSETS
   Other current assets.........................................................         $                     $0.2
                                                                                         --------          --------
       Total current assets.....................................................                                0.2

Investments in and amounts due to/from subsidiaries eliminated
   upon consolidation, net......................................................          2,751.6           2,091.0

Deferred charges, net...........................................................             27.1              17.1
                                                                                         --------          --------
                                                                                         $2,778.7          $2,108.3
                                                                                         ========          ========

LIABILITIES AND STOCKHOLDER'S EQUITY
CURRENT LIABILITIES
   Accrued interest and other...................................................            $30.9             $24.1
                                                                                         --------          --------
       Total current liabilities................................................             30.9              24.1
                                                                                         --------          --------

   Long-term debt...............................................................          2,489.4           1,691.1
                                                                                         --------          --------

   Notes payable to affiliate...................................................                               72.3
                                                                                         --------          --------

   Deferred income taxes, due to affiliates.....................................             83.7              51.9
                                                                                         --------          --------

   Other liabilities ...........................................................              1.7               1.8
                                                                                         --------          --------

STOCKHOLDER'S EQUITY
   Common stock, $1 par value - authorized and issued, 1,000 shares.............
   Additional capital...........................................................          3,066.2           3,066.2
   Accumulated deficit..........................................................         (2,896.4)         (2,799.1)
   Unrealized gains on marketable securities held by a subsidiary...............              3.2
                                                                                         --------          --------
       Total stockholder's equity...............................................            173.0             267.1
                                                                                         --------          --------
                                                                                         $2,778.7          $2,108.3
                                                                                         ========          ========
</TABLE>

                                     - 40 -
<PAGE>
               COMCAST CABLE COMMUNICATIONS, INC. AND SUBSIDIARIES

                SCHEDULE I -- CONDENSED FINANCIAL INFORMATION OF

                     REGISTRANT UNCONSOLIDATED (PARENT ONLY)

            CONDENSED STATEMENT OF OPERATIONS AND ACCUMULATED DEFICIT

                                  (In millions)
<TABLE>
<CAPTION>
                                                                                   Year Ended December 31,
                                                                          1998              1997             1996
<S>                                                                    <C>              <C>               <C>       
AMORTIZATION..................................................              $1.7             $1.0         $
                                                                       ---------        ---------         --------- 

OPERATING LOSS................................................               1.7              1.0

OTHER (INCOME) EXPENSE
   Interest (income) expense on affiliate notes, net..........            (142.4)           (93.3)             16.4
   Interest expense (income), net.............................             149.9             96.5              (0.6)
   Equity in net losses of affiliates.........................              82.1            117.9               5.1
                                                                       ---------        ---------         --------- 
                                                                            89.6            121.1              20.9

LOSS BEFORE INCOME TAX EXPENSE................................             (91.3)          (122.1)            (20.9)

INCOME TAX EXPENSE............................................               6.0              6.7               1.7
                                                                       ---------        ---------         --------- 

NET LOSS......................................................             (97.3)          (128.8)            (22.6)

ACCUMULATED DEFICIT
   Beginning of year..........................................          (2,799.1)        (2,124.0)         (2,101.4)
   Elimination of outstanding notes receivable from
     affiliate through a non-cash dividend to Comcast.........                             (546.3)
                                                                       ---------        ---------         --------- 

   End of year................................................         ($2,896.4)       ($2,799.1)        ($2,124.0)
                                                                       =========        =========         ========= 
</TABLE>


                                     - 41 -
<PAGE>
               COMCAST CABLE COMMUNICATIONS, INC. AND SUBSIDIARIES

                SCHEDULE I -- CONDENSED FINANCIAL INFORMATION OF

                     REGISTRANT UNCONSOLIDATED (PARENT ONLY)

                        CONDENSED STATEMENT OF CASH FLOWS

                                  (In millions)

<TABLE>
<CAPTION>
                                                                                  Year Ended December 31,
                                                                         1998              1997             1996
<S>                                                                     <C>             <C>                <C>    

OPERATING ACTIVITIES
   Net loss...................................................            ($97.3)         ($128.8)           ($22.6)
   Adjustments to reconcile net loss to net cash provided by
    (used in) operating activities:
     Amortization.............................................               1.7              1.0
     Non-cash interest expense................................               0.4
     Equity in net losses of affiliates.......................              82.1            117.9               5.1
     Deferred income tax benefit..............................              31.8             50.4              (4.3)
                                                                          ------         --------          --------
                                                                            18.7             40.5             (21.8)

     Changes in working capital and other liabilities.........               6.9             29.1               2.2
                                                                          ------         --------          --------
       Net cash provided by (used in) operating activities....              25.6             69.6             (19.6)
                                                                          ------         --------          --------

FINANCING ACTIVITIES
   Proceeds from borrowings...................................             797.9          1,691.1
   Proceeds from notes payable to affiliate...................              72.4             72.3
   Repayment of notes payable to affiliates...................            (144.7)           (45.0)
   Deferred financing costs...................................             (11.7)           (18.1)              0.3
                                                                          ------         --------          --------
     Net cash provided by financing activities................             713.9          1,700.3               0.3
                                                                          ------         --------          --------

INVESTING ACTIVITIES
   Net transactions with affiliates...........................            (739.5)        (1,769.9)             14.8
                                                                          ------         --------          --------
     Net cash (used in) provided by investing activities......            (739.5)        (1,769.9)             14.8
                                                                          ------         --------          --------

DECREASE IN CASH AND CASH EQUIVALENTS.........................                                                 (4.5)

CASH AND CASH EQUIVALENTS, beginning of year..................                                                  4.5
                                                                          ------         --------          --------

CASH AND CASH EQUIVALENTS, end of year........................            $              $                 $
                                                                          ======         ========          ========
</TABLE>


                                     - 42 -
<PAGE>
               COMCAST CABLE COMMUNICATIONS, INC. AND SUBSIDIARIES

                 SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS

                  YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996

                                  (In millions)

<TABLE>
<CAPTION>
                                                                                  Additions
                                                       Balance at                Charged to   Deductions      Balance
                                                        Beginning    Effect of    Costs and      from         at End
                                                         of Year   Acquisitions   Expenses    Reserves(A)     of Year

Allowance for Doubtful Accounts

<S>                                                      <C>         <C>             <C>          <C>           <C>  
   1998.....................................             $16.7       $             $15.8        $13.1         $19.4

   1997.....................................              12.0                      18.4         13.7          16.7

   1996.....................................              10.7          1.4         15.7         15.8          12.0
</TABLE>

(A)  Uncollectible accounts written off.

                                     - 43 -