**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**





**Washington,
      D.C. 20549**





**FORM
      10-Q**





*(Mark
      One)*


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





**For
      the quarterly period ended March 31, 2007**





**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:** **333-112593**


**** **333-112593-01** ****





**CCO
      Holdings, LLC ***


**CCO
      Holdings Capital Corp. ***


*(Exact
      name of registrants as specified in their charters)*





**Delaware**
              **Delaware**
            
            **86-1067239**
              **20-0257904***(State
                or other jurisdiction of incorporation or
                organization)*
            
            *(I.R.S.
                Employer Identification
                Number)*





**12405
      Powerscourt Drive**


**St.
      Louis, Missouri   63131**


*(Address
      of principal executive offices including zip code)*





**(314)
      965-0555**


*(Registrants’
      telephone number, including area code)*





Indicate
      by check mark whether the registrants (1) have 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 registrants were
      required to file such reports), and (2) have been subject to such filing
      requirements for the past 90 days. YES [X] NO [  ]





Indicate
      by check mark whether the registrants are large accelerated filers, accelerated
      filers, or non-accelerated filers. See definition of “accelerated filer and
      large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check
      one):





Large
      accelerated filer o  Accelerated
      filer o  Non-accelerated
      filer þ





Indicate
      by check mark whether the registrants are shell companies (as defined in Rule
      12b-2 of the Act). Yes o No þ





Number
      of
      shares of common stock of CCO Holdings Capital Corporation outstanding as of
      May
      15, 2007: 1





*
      CCO
      Holdings, LLC and CCO Holdings Capital Corp. meet the conditions set forth
      in
      General Instruction H(1)(a) and (b) to Form 10-Q and are therefore filing with
      the reduced disclosure format.













**CCO
      Holdings, LLC**


**CCO
      Holdings Capital Corp.**


**Quarterly
      Report on Form 10-Q for the Period ended March 31, 2007**





**Table
      of Contents**





PART
                I. FINANCIAL INFORMATION
            **Page**Item
                1.**Financial
                Statements - CCO Holdings, LLC and Subsidiaries**Condensed
                Consolidated Balance Sheets as ofMarch
                31, 2007and
                December 31, 2006
            4Condensed
                Consolidated Statements of Operations for the threemonths
                endedMarch
                31, 2007and
                2006
            5Condensed
                Consolidated Statements of Cash Flows for thethree
                months endedMarch
                31, 2007 and 2006
            6Notes
                to Condensed Consolidated Financial Statements
            7Item
                2.Management's
                Discussion and Analysis of Financial Condition and Results of
                Operations
            16Item
                4.Controls
                and Procedures
            26PART
                II. OTHER INFORMATIONItem
                1.Legal
                Proceedings
            27Item
                1A. Risk Factors
            27Item
                6.Exhibits
            31SIGNATURES
            S-1EXHIBIT
                INDEX
            E-1





This
      quarterly report on Form 10-Q is for the three months ended March 31, 2007.
      The Securities and Exchange Commission ("SEC") allows us to "incorporate by
      reference" information that we file with the SEC, 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 quarterly report. In addition, information that we file with the SEC in
      the
      future will automatically update and supersede information contained in this
      quarterly report. In this quarterly report, "we," "us" and "our" refer to CCO
      Holdings, LLC and its subsidiaries.














**CAUTIONARY
      STATEMENT REGARDING FORWARD-LOOKING STATEMENTS:**





This quarterly
      report includes
      forward-looking statements within the meaning of Section 27A of the
      Securities Act of 1933, as amended (the " Securities
      Act " ),
      and
      Section 21E of the Securities Exchange Act of 1934, as amended (the " Exchange
      Act " ),
      regarding, among other things, our plans, strategies and prospects, both
      business and financial including, without limitation, the forward-looking
      statements set forth in the " Results
      of Operations " and " Liquidity
      and Capital Resources " sections
      under Part I, Item 2. " Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations " in this quarterly
      report .
      Although we believe that our plans, intentions and expectations reflected in
      or
      suggested by these forward-looking statements are reasonable, we cannot assure
      you that we will achieve or realize these plans, intentions or expectations.
      Forward-looking statements are inherently subject to risks, uncertainties and
      assumptions including, without limitation, the factors described under " Risk
      Factors " under
      Part II, Item 1A. Many of the forward-looking statements contained in this quarterly
      report may
      be
      identified by the use of forward-looking words such as " believe, "  " expect, "  " anticipate, "  " should, "  " planned, "  " will, "  " may, "  " intend, "  " estimated, "  "aim,"
      "on track," "target,"  "opportunity" and " potential " among
      others. Important factors that could cause actual results to differ materially
      from the forward-looking statements we make in this quarterly
      report are
      set
      forth in this quarterly
      report and
      in
      other reports or documents that we file from time to time with the SEC, and
      include, but are not limited to:




·
              the
                  availability, in general, of funds to meet interest payment obligations
                  under our and our parent companies’ debt and to fund our operations and
                  necessary capital expenditures, either through cash flows from
                  operating
                  activities, further borrowings or other sources and, in particular,
                  our
                  and our parent companies’ ability to be able to provide under the
                  applicable debt instruments such funds (by dividend, investment
                  or
                  otherwise) to the applicable obligor of such
                  debt;
 ·
              our
                  and our parent companies’ ability to comply with all covenants in our and
                  our parent companies’ indentures and credit facilities, any violation of
                  which could trigger a default of our other obligations under cross-default
                  provisions;
 ·
              our
                  and our parent companies’ ability to pay or refinance debt prior to or
                  when it becomes due and/or refinance that debt through new issuances,
                  exchange offers or otherwise, including restructuring our and our
                  parent
                  companies’ balance sheet and leverage
                  position; ·
              competition
                  from other distributors, including incumbent telephone companies,
                  direct
                  broadcast satellite operators, wireless broadband providers and
                  DSL
                  providers; ·
              difficulties
                  in introducing and operating our telephone services, such as our
                  ability
                  to adequately meet customer expectations for the reliability of
                  voice
                  services, and our ability to adequately meet demand for installations
                  and
                  customer service;
 ·
              our
                  ability to sustain and grow revenues and cash flows from operating
                  activities by offering video, high-speed Internet, telephone and
                  other
                  services, and to maintain and grow our customer base, particularly
                  in the
                  face of increasingly aggressive
                  competition;
 ·
              our
                  ability to obtain programming at reasonable prices or to adequately
                  raise
                  prices to offset the effects of higher programming costs;
 ·
              general
                  business conditions, economic uncertainty or slowdown;
                  and
 ·
              the
                  effects of governmental regulation, including but not limited to
                  local
                  franchise authorities, on our business.


All
      forward-looking statements attributable to us or any person acting on our behalf
      are expressly qualified in their entirety by this cautionary statement. We
      are
      under no duty or obligation to update any of the forward-looking statements
      after the date of this quarterly
      report .




3


**PART
      I. FINANCIAL INFORMATION.**








**Item
      1.**  **Financial
      Statements.**


**CCO
      HOLDINGS, LLC AND SUBSIDIARIES**


**CONDENSED
      CONSOLIDATED BALANCE SHEETS**


**(** **DOLLARS
      IN MILLIONS** **)**





**March
                31****,**
            
            **December
                31,****2007**
            
            **2006****(Unaudited)****ASSETS**CURRENT
                ASSETS:Cash
                and cash equivalents
            
            $
            63
            
            $
            28Accounts
                receivable, less allowance for doubtful accounts of$16
                and $16, respectively
            
            
            156
            
            
            194Prepaid
                expenses and other current assets
            
            
            25
            
            
            23Total
                current assets
            
            
            244
            
            
            245INVESTMENT
                IN CABLE PROPERTIES:Property,
                plant and equipment, net of accumulateddepreciation
                of $7,925 and $7,602, respectively
            
            
            5,143
            
            
            5,181Franchises,
                net
            
            
            9,218
            
            
            9,223Total
                investment in cable properties, net
            
            
            14,361
            
            
            14,404OTHER
                NONCURRENT ASSETS
            
            
            193
            
            
            176Total
                assets
            
            $
            14,798
            
            $
            14,825**LIABILITIES
                AND MEMBER’S EQUITY**CURRENT
                LIABILITIES:Accounts
                payable and accrued expenses
            
            $
            969
            
            $
            901Payables
                to related party
            
            
            131
            
            
            147Total
                current liabilities
            
            
            1,100
            
            
            1,048LONG-TERM
                DEBT
            
            
            8,825
            
            
            8,610LOANS
                PAYABLE - RELATED PARTY
            
            
            326
            
            
            303DEFERRED
                MANAGEMENT FEES - RELATED PARTY
            
            
            14
            
            
            14OTHER
                LONG-TERM LIABILITIES
            
            
            366
            
            
            362MINORITY
                INTEREST
            
            
            646
            
            
            641MEMBER’S
                EQUITYMember’s
                equity
            
            
            3,523
            
            
            3,846Accumulated
                other comprehensive income (loss)
            
            
            (2
            )
            
            1Total
                member’s equity
            
            
            3,521
            
            
            3,847Total
                liabilities and member’s equity
            
            $
            14,798
            
            $
            14,825


The
          accompanying notes are an integral part of these condensed consolidated
          financial statements.
 4


**CCO
      HOLDINGS, LLC AND SUBSIDIARIES**


**CONDENSED**  **CONSOLIDATED
      STATEMENTS OF OPERATIONS**


**(DOLLARS
      IN MILLIONS)**


**Unaudited**




**Three
                Months Ended March 31,****2007**
            
            **2006**REVENUES
            
            $
            1,425
            
            $
            1,320COSTS
                AND EXPENSES:Operating
                (excluding depreciation and amortization)
            
            
            631
            
            
            604Selling,
                general and administrative
            
            
            303
            
            
            272Depreciation
                and amortization
            
            
            331
            
            
            350Asset
                impairment charges
            
            
            --
            
            
            99Other
                operating expenses, net
            
            
            4
            
            
            31,269
            
            
            1,328Operating
                income (loss) from continuing operations
            
            
            156
            
            
            (8
            )OTHER
                INCOME AND (EXPENSES):Interest
                expense, net
            
            
            (190
            )
            
            (192
            )Other
                income (expense), net
            
            
            (7
            )
            
            6(197
            )
            
            (186
            )Loss
                from continuing operations before income taxes
            
            
            (41
            )
            
            (194
            )INCOME
                TAX EXPENSE
            
            
            (2
            )
            
            (2
            )Loss
                from continuing operations
            
            
            (43
            )
            
            (196
            )INCOME
                FROM DISCONTINUED OPERATIONS, NET OF TAX
            
            
            --
            
            
            15Net
                loss
            
            $
            (43
            )
            $
            (181
            )


The
          accompanying notes are an integral part of these condensed consolidated
          financial statements.
 5


**CCO
      HOLDINGS, LLC AND SUBSIDIARIES**


**CONDENSED
      CONSOLIDATED STATEMENTS OF CASH FLOWS**


**(DOLLARS
      IN MILLIONS)**


**Unaudited**





**Three
                Months Ended March****31,****2007**
            
            **2006**CASH
                FLOWS FROM OPERATING ACTIVITIES:Net
                loss
            
            $
            (43
            )
            $
            (181
            )Adjustments
                to reconcile net loss to net cash flows from operating
                activities:Depreciation
                and amortization
            
            
            331
            
            
            358Asset
                impairment charges
            
            
            --
            
            
            99Noncash
                interest expense
            
            
            4
            
            
            8Other,
                net
            
            
            16
            
            
            (2
            )Changes
                in operating assets and liabilities, net of effects from acquisitions
                and
                dispositions:Accounts
                receivable
            
            
            38
            
            
            60Prepaid
                expenses and other assets
            
            
            (4
            )
            
            (3
            )Accounts
                payable, accrued expenses and other
            
            
            92
            
            
            (11
            )Receivables
                from and payables to related party, including deferred
              management
                fees
            
            
            2
            
            
            (5
            )Net
                cash flows from operating activities
            
            
            436
            
            
            323CASH
                FLOWS FROM INVESTING ACTIVITIES:Purchases
                of property, plant and equipment
            
            
            (298
            )
            
            (241
            )Change
                in accrued expenses related to capital expenditures
            
            
            (32
            )
            
            (7
            )Purchase
                of cable system
            
            
            --
            
            
            (42
            )Other,
                net
            
            
            9
            
            
            14Net
                cash flows from investing activities
            
            
            (321
            )
            
            (276
            )CASH
                FLOWS FROM FINANCING ACTIVITIES:Borrowings
                of long-term debt
            
            
            911
            
            
            415Borrowings
                from related parties
            
            
            --
            
            
            300Repayments
                of long-term debt
            
            
            (691
            )
            
            (759
            )Proceeds
                from issuance of debt
            
            
            --
            
            
            --Payments
                for debt issuance costs
            
            
            (20
            )
            
            --Contributions
            
            
            --
            
            
            148Distributions
            
            
            (280
            )
            
            (130
            )Net
                cash flows from financing activities
            
            
            (80
            )
            
            (26
            )NET
                INCREASE IN CASH AND CASH EQUIVALENTS
            
            
            35
            
            
            21CASH
                AND CASH EQUIVALENTS, beginning of period
            
            
            28
            
            
            3CASH
                AND CASH EQUIVALENTS, end of period
            
            $
            63
            
            $
            24CASH
                PAID FOR INTEREST
            
            $
            135
            
            $
            127NONCASH
                TRANSACTIONS:Issuance
                of debt by Charter Communications Operating, LLC
            
            $
            --
            
            $
            37Retirement
                of Renaissance Media Group LLC debt
            
            $
            --
            
            $
            (37
            )





The
          accompanying notes are an integral part of these condensed consolidated
          financial statements.
 6
 **CCO
          HOLDINGS, LLC AND SUBSIDIARIES**
 **NOTES
          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **(UNAUDITED)**
 **(dollars
          in millions, except where indicated)**




**1.   Organization
      and Basis of Presentation**




CCO
      Holdings, LLC ("CCO Holdings") is a holding company whose principal assets
      at
      March 31, 2007 are the equity interests in its operating subsidiaries. CCO
      Holdings is a direct subsidiary of CCH II, LLC (“CCH II”) which is an indirect
      subsidiary of Charter Communications Holdings, LLC ("Charter Holdings"). Charter
      Holdings is an indirect subsidiary of Charter Communications, Inc. (“Charter”).
      The condensed consolidated financial statements include the accounts of CCO
      Holdings and all of its subsidiaries where the underlying operations reside,
      which are collectively referred to herein as the "Company." All significant
      intercompany accounts and transactions among consolidated entities have been
      eliminated.





The
      Company is a broadband communications company operating in the United States.
      The Company offers to residential and commercial customers traditional cable
      video programming (analog and digital video), high-speed Internet services,
      advanced broadband services such as high definition television, Charter
      OnDemandTM, and digital video recorder service, and, in many of our markets,
      telephone service. The Company sells its cable video programming, high-speed
      Internet, telephone, and advanced broadband services on a subscription basis.
      The Company also sells local advertising on cable networks.





The
      accompanying condensed consolidated financial statements of the Company have
      been prepared in accordance with accounting principles generally accepted in
      the
      United States for interim financial information and the rules and regulations
      of
      the Securities and Exchange Commission (the "SEC"). Accordingly, certain
      information and footnote disclosures typically included in CCO Holdings’ Annual
      Report on Form 10-K have been condensed or omitted for this quarterly report.
      The accompanying condensed consolidated financial statements are unaudited
      and
      are subject to review by regulatory authorities. However, in the opinion of
      management, such financial statements include all adjustments, which consist
      of
      only normal recurring adjustments, necessary for a fair presentation of the
      results for the periods presented. Interim results are not necessarily
      indicative of results for a full year.




The
      preparation of financial statements in conformity with accounting principles
      generally accepted in the United States 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. Areas involving significant judgments and estimates include
      capitalization of labor and overhead costs; depreciation and amortization costs;
      impairments of property, plant and equipment, franchises and goodwill; income
      taxes; and contingencies. Actual results could differ from those
      estimates.




*Reclassifications*




Certain
      2006 amounts have been reclassified to conform with the 2007 presentation,
      including discontinued operations as discussed in Note 3.





**2.**  **Liquidity
      and
      Capital Resources**





The
      Company incurred net losses of $43 million and $181 million for the three months
      ended March 31, 2007 and 2006, respectively. The Company’s net cash flows from
      operating activities were $436 million and $323 million for the three months
      ended March 31, 2007 and 2006, respectively.





The
      Company’s long-term financing as of March 31, 2007 consists of $5.6 billion of
      credit facility debt and $3.2 billion accreted value of high-yield notes. For
      the remaining three quarterly periods of 2007, none of the Company’s debt
      matures. In each of 2008 and 2009, $55 million of the Company’s debt matures. In
      2010 and beyond, significant additional amounts will become due under the
      Company’s remaining long-term debt obligations.





The
      Company requires significant cash to fund debt service costs, capital
      expenditures and ongoing operations. The Company has historically funded these
      requirements through cash flows from operating activities, borrowings under
      its
      credit facilities, equity contributions from its parent companies, sales of
      assets, issuances of debt securities, and cash on hand. However, the mix of
      funding sources changes from period to period. For the three months ended




7
 **CCO
          HOLDINGS, LLC AND SUBSIDIARIES**
 **NOTES
          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **(UNAUDITED)**
 **(dollars
          in millions, except where indicated)**




March
      31,
      2007, the Company generated $436 million of net cash flows from operating
      activities, after paying cash interest of $135 million. In addition, the Company
      used approximately $298 million for purchases of property, plant and equipment.
      Finally, the Company had net cash used in financing activities of $80 million,
      as a result of increased distributions during the period and a decrease in
      borrowings from related parties.





The
      Company expects that cash on hand, cash flows from operating activities, and
      the
      amounts available under its credit facilities will be adequate to meet its
      and
      its parent companies’ cash needs through 2008.  The Company believes that
      cash flows from operating activities and amounts available under the Company’s
      credit facilities may not be sufficient to fund the Company’s operations and
      satisfy its and its parent companies’ interest and principal repayment
      obligations in 2009, and will not be sufficient to fund such needs in 2010
      and
      beyond. The Company has been advised that Charter continues to work with its
      financial advisors concerning its approach to addressing liquidity, debt
      maturities, and overall balance sheet leverage.





***Credit
      Facility Availability***





The
      Company’s ability to operate depends upon, among other things, its continued
      access to capital, including credit under the Charter Communications Operating,
      LLC (“Charter Operating”) credit facilities. The Charter Operating credit
      facilities, along with the Company’s indentures and the CCO Holdings credit
      facilities, contain certain restrictive covenants, some of which require the
      Company to maintain specified leverage ratios, meet financial tests, and provide
      annual audited financial statements with an unqualified opinion from the
      Company’s independent auditors. As of March 31, 2007, the Company was in
      compliance with the covenants under its indentures and credit facilities, and
      the Company expects to remain in compliance with those covenants for the next
      twelve months. As of March 31, 2007, t he Company’s potential availability under its revolving credit facility totaled
      approximately $1.4 billion, none of which was limited by covenant
      restrictions . Continued
      access to the Company’s credit facilities is subject to the Company remaining in
      compliance with these covenants, including covenants tied to the Company’s
      leverage ratio. If any event of non-compliance were to occur, funding under
      the
      credit facilities may not be available and defaults on some or potentially
      all
      of the Company’s debt obligations could occur. An event of default under any of
      the Company’s debt instruments could result in the acceleration of its payment
      obligations under that debt and, under certain circumstances, in cross-defaults
      under its other debt obligations, which could have a material adverse effect
      on
      the Company’s consolidated financial condition and results of
      operations.





***Parent
      Company Debt Obligations***





Any
      financial or liquidity problems of the Company’s parent companies could cause
      serious disruption to the Company’s business and have a material adverse effect
      on the Company’s business and results of operations. A failure by Charter
      Holdings, CCH I Holdings, LLC (“CIH”), CCH I, LLC (“CCH I”), or CCH II to
      satisfy their debt payment obligations or a bankruptcy with respect to Charter
      Holdings, CIH, CCH I, or CCH II would give the lenders under the Company’s
      credit facilities the right to accelerate the payment obligations under these
      facilities. Any such acceleration would be a default under the indenture
      governing the Company’s notes. On a consolidated basis, the Company’s parent
      companies have a significant level of debt, which, including the Company’s debt,
      totaled approximately $19.3 billion as of March 31, 2007.





***Limitations*** ***on
      Distributions***





As
      long
      as Charter’s convertible notes remain outstanding and are not otherwise
      converted into shares of common stock, Charter must pay interest on the
      convertible senior notes and repay the principal amount in November 2009. Charter’s
      ability to make interest payments on its convertible senior notes, and, in
      2009,
      to repay the outstanding principal of its convertible senior notes of $413
      million, net of $450 million of convertible senior notes held by CCHC, LLC
      (“CCHC”), will depend on its ability to raise additional capital and/or on
      receipt of payments or distributions from Charter Communications Holding
      Company, LLC (“Charter Holdco”) and its subsidiaries. As
      of March 31, 2007, Charter Holdco was owed $4 million in intercompany loans
      from
      its subsidiaries and had $8 million in cash, which were available to pay
      interest and principal on Charter's convertible senior notes.  In
      addition, Charter has $50 million of U.S. government securities pledged as
      security for the semi-annual interest payments on Charter’s




8
 **CCO
          HOLDINGS, LLC AND SUBSIDIARIES**
 **NOTES
          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **(UNAUDITED)**
 **(dollars
          in millions, except where indicated)**




convertible
      senior notes scheduled in 2007.  As long as CCHC continues to hold the $450
      million of Charter’s convertible senior notes, CCHC will receive interest
      payments from the government securities pledged for Charter’s convertible senior
      notes.  The cumulative amount of interest payments expected to be received
      by CCHC is $40 million and may be available to be distributed to pay semiannual
      interest due in 2008 and May 2009 on the outstanding principal amount of $413
      million of Charter’s convertible senior notes, although CCHC may use those
      amounts for other purposes.





As
      of
      March 31, 2007, Charter Holdings, CIH, CCH I, and CCH II had approximately
      $9.9
      billion principal amount of high-yield notes outstanding with approximately
      $0,
      $415 million, $2.3 billion, and $7.2 billion maturing in 2008, 2009, 2010,
      and
      thereafter, respectively. Charter Holdings, CIH, CCH I, and CCH II will need
      to
      raise additional capital or receive distributions or payments from the Company
      in order to satisfy their debt obligations. However, because of their
      significant indebtedness, the Company’s ability, and the ability of the parent
      companies to raise additional capital at reasonable rates or at all is
      uncertain. During the three months ended March 31, 2007, the Company distributed
      $280 million of cash to its parent company.





Distributions
      by Charter’s subsidiaries to a parent company (including Charter, Charter
      Holdco, CCHC, Charter Holdings, CIH, CCH I, and CCH II) for
      payment of principal on parent company notes, are
      restricted under the indentures governing the CIH notes, CCH I notes, CCH II
      notes, CCO Holdings notes, and Charter Operating notes and under the CCO
      Holdings credit facilities unless
      there is no default under the applicable indenture and credit facilities, and
      each applicable subsidiary’s leverage ratio test is met at the time of such
      distribution. F or
      the
      quarter ended March 31, 2007, there was no default under any of these indentures
      or credit facilities. However, certain of Charter’s subsidiaries did not meet
      their applicable leverage ratio tests based on March 31, 2007 financial results.
      As a result, distributions from certain of Charter’s subsidiaries to their
      parent companies would have been restricted at such time and will continue
      to be
      restricted unless those tests are met. Distributions by Charter Operating for
      payment of principal on parent company notes are further restricted by the
      covenants in its credit facilities.





Distributions
      by CIH, CCH I, CCH II, CCO Holdings and Charter Operating to a parent company
      for payment of parent company interest are permitted if there is no default
      under the aforementioned indentures and CCO Holdings credit facilities.





The
      indentures governing the Charter Holdings notes permit Charter Holdings to
      make
      distributions to Charter Holdco for payment of interest or principal on
      Charter’s convertible senior notes, only if, after giving effect to the
      distribution, Charter Holdings can incur additional debt under the leverage
      ratio of 8.75 to 1.0, there is no default under Charter Holdings’ indentures,
      and other specified tests are met. For the quarter ended March
      31,
      2007, there was no default under Charter Holdings’ indentures and the other
      specified tests were met. However,
      Charter Holdings did not meet the leverage ratio test of 8.75 to 1.0 based
      on
      March 31, 2007 financial results. As a result, distributions from Charter
      Holdings to Charter or Charter Holdco would have been restricted at such time
      and will continue to be restricted unless that test is met. During periods
      in which distributions are restricted, the
      indentures governing the Charter Holdings notes permit Charter Holdings and
      its
      subsidiaries to make specified investments (that are not restricted payments)
      in
      Charter Holdco or Charter, up to an amount determined by a formula, as long
      as
      there is no default under the indentures.





***Recent
      Financing Transactions***





In
      March
      2007, Charter Operating entered into an Amended and Restated Credit Agreement
      (the “Charter Operating Credit Agreement”) which provides for a $1.5 billion
      senior secured revolving line of credit, a continuation of the existing $5.0
      billion term loan facility (which was refinanced with new term loans in April
      2007), and a $1.5 billion new term loan facility, which was funded in March
      and
      April 2007. In March 2007, CCO Holdings entered into a credit agreement which
      consisted of a $350 million term loan facility funded in March and April 2007.
      In April 2007, Charter Holdings completed a cash tender offer to purchase up
      to
      $100 million, including premiums and accrued interest, of its outstanding notes.
      In addition, Charter Holdings redeemed $187 million of its 8.625% senior notes
      due April 1, 2009 and CCO Holdings redeemed $550 million of its senior floating
      rate notes due December 15, 2010. These redemptions closed in April 2007. See
      Note 6.




9
 **CCO
          HOLDINGS, LLC AND SUBSIDIARIES**
 **NOTES
          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **(UNAUDITED)**
 **(dollars
          in millions, except where indicated)**




**3.   Sale
      of
      Assets**




In
      2006,
      the Company sold certain cable television systems serving a total of
      approximately 356,000 analog video customers in 1) West Virginia and
      Virginia to
      Cebridge Connections, Inc. (the “Cebridge Transaction”); 2) Illinois and
      Kentucky to Telecommunications Management, LLC, doing business as New Wave
      Communications (the “New Wave Transaction”) and 3) Nevada, Colorado, New Mexico
      and Utah to Orange Broadband Holding Company, LLC (the
“Orange Transaction”) for a total sales price of approximately $971 million. The
      Company used the net proceeds from the asset sales to reduce borrowings, but
      not
      commitments, under the revolving portion of the Company’s credit facilities.
      These cable systems met the criteria for assets held for sale. As such, the
      assets were written down to fair value less estimated costs to sell resulting
      in
      asset impairment charges during the three months ended March 31, 2006 of
      approximately $99 million related to the New Wave Transaction and the Orange
      Transaction. The Company determined that the West Virginia and Virginia cable
      systems comprise operations and cash flows that for financial reporting purposes
      meet the criteria for discontinued operations. Accordingly, the results of
      operations for the West Virginia and Virginia cable systems have been presented
      as discontinued operations, net of tax for the three months ended March 31,
      2006.





Summarized
      consolidated financial information for the three months ended March 31, 2006
      for
      the West Virginia and Virginia cable systems is as follows:





**Three
                Months Ended March 31, 2006**Revenues
            
            $
            54Net
                income
            
            $
            15




**4.   Franchises
      and Goodwill**




Franchise
      rights represent the value attributed to agreements with local authorities
      that
      allow access to homes in cable service areas acquired through the purchase
      of
      cable systems. Management estimates the fair value of franchise rights at the
      date of acquisition and determines if the franchise has a finite life or an
      indefinite-life as defined by Statement of Financial Accounting Standards
      (“SFAS”) No. 142, *Goodwill
      and Other Intangible Assets* . Franchises
      that qualify for indefinite-life treatment under SFAS No. 142 are tested
      for impairment annually each October 1 based on valuations, or more frequently
      as warranted by events or changes in circumstances. Franchises are aggregated
      into essentially inseparable asset groups to conduct the valuations. The asset
      groups generally represent geographical clustering of the Company’s cable
      systems into groups by which such systems are managed. Management believes
      such
      grouping represents the highest and best use of those assets.





As
      of
      March 31, 2007 and December 31, 2006, indefinite-lived and finite-lived
      intangible assets are presented in the following table:





**March
                31, 2007**
            
            **December 31,
                2006****Gross**
              **Carrying**
              **Amount**
            
            **Accumulated**
              **Amortization**
            
            **Net**
              **Carrying**
              **Amount**
            
            **Gross**
              **Carrying**
              **Amount**
            
            **Accumulated
                Amortization**
            
            **Net**
              **Carrying**
              **Amount****Indefinite-lived
                intangible assets:**Franchises
                with indefinite lives
            
            $
            9,203
            
            $
            --
            
            $
            9,203
            
            $
            9,207
            
            $
            --
            
            $
            9,207Goodwill
            
            
            61
            
            
            --
            
            
            61
            
            
            61
            
            
            --
            
            
            61$
            9,264
            
            $
            --
            
            $
            9,264
            
            $
            9,268
            
            $
            --
            
            $
            9,268**Finite-lived
                intangible assets:**Franchises
                with finite lives
            
            $
            23
            
            $
            8
            
            $
            15
            
            $
            23
            
            $
            7
            
            $
            16




10
 **CCO
          HOLDINGS, LLC AND SUBSIDIARIES**
 **NOTES
          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **(UNAUDITED)**
 **(dollars
          in millions, except where indicated)**




For
      the
      three months ended March 31, 2007, the net carrying amount of indefinite-lived
      and finite-lived franchises was reduced by $4 million, related to cable asset
      sales completed in the first quarter of 2007. Franchise amortization expense
      represents the amortization relating to franchises that did not qualify for
      indefinite-life treatment under SFAS No. 142, including costs associated with
      franchise renewals. Franchise amortization expense for the three months ended
      March 31, 2007 was approximately $1 million. The Company expects that
      amortization expense on franchise assets will be approximately $3 million
      annually for each of the next five years. Actual amortization expense in future
      periods could differ from these estimates as a result of new intangible asset
      acquisitions or divestitures, changes in useful lives and other relevant
      factors.





**5.**  **Accounts
      Payable and Accrued Expenses**





Accounts
      payable and accrued expenses consist of the following as of March 31, 2007
      and
      December 31, 2006:





**March
                31,**
              **2007**
            
            **December 31,**
              **2006**Accounts
                payable - trade
            
            $
            141
            
            $
            79Accrued
                capital expenditures
            
            
            65
            
            
            97Accrued
                expenses:Interest
            
            
            162
            
            
            117Programming
                costs
            
            
            311
            
            
            268Franchise-related
                fees
            
            
            43
            
            
            68Compensation
            
            
            56
            
            
            74Other
            
            
            191
            
            
            198$
            969
            
            $
            901




**6.   Long-Term
      Debt**




Long-term
      debt consists of the following as of March
      31,
      2007 and
      December 31, 2006:





**March
                31, 2007**
            
            **December
                31, 2006****Principal
                Amount**
            
            **Accreted
                Value**
            
            **Principal
                Amount**
            
            **Accreted
                Value****Long-Term
                Debt**CCO
                Holdings, LLC:Senior
                floating notes due December 15, 2010
            
            $
            550
            
            $
            550
            
            $
            550
            
            $
            55083⁄4%
                senior notes due November 15, 2013
            
            
            800
            
            
            795
            
            
            800
            
            
            795Charter
                Communications Operating, LLC:8.000%
                senior second lien notes due April 30, 2012
            
            
            1,100
            
            
            1,100
            
            
            1,100
            
            
            1,1008
                3/8% senior second lien notes due April 30, 2014
            
            
            770
            
            
            770
            
            
            770
            
            
            770Credit
                Facilities
            
            
            5,610
            
            
            5,610
            
            
            5,395
            
            
            5,395$
            8,830
            
            $
            8,825
            
            $
            8,615
            
            $
            8,610





The
      accreted values presented above generally represent the principal amount of
      the
      notes less the original issue discount at the time of sale plus the accretion
      to
      the balance sheet date.





In
      March
      2007, Charter Operating entered into the Charter Operating Credit Agreement
      which provides for a $1.5 billion senior secured revolving line of credit,
      a
      continuation of the existing $5.0 billion term loan facility (the “Existing Term
      Loan”), and a $1.5 billion new term loan facility (the “New Term Loan”), which
      was funded in March




11
 **CCO
          HOLDINGS, LLC AND SUBSIDIARIES**
 **NOTES
          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **(UNAUDITED)**
 **(dollars
          in millions, except where indicated)**




and
      April
      2007. Borrowings under the Charter Operating Credit Agreement bear interest
      at a
      variable interest rate based on either LIBOR or a base rate, plus in either
      case, an applicable margin. The applicable margin for LIBOR loans under the
      New
      Term Loan and revolving loans is 2.00% above LIBOR. The revolving line of credit
      commitments terminate in March 2013. The Existing Term Loan and the New Term
      Loan are subject to amortization at 1% of their initial principal amount per
      annum. The New Term Loan amortization commences on March 31, 2008. The remaining
      principal amount of the New Term Loan will be due in March 2014.





The
      terms
      of the Existing Term Loan were amended in March 2007. The refinancing of the
      $5.0 billion Existing Term Loan with new term loans was permitted under the
      Charter Operating Credit Agreement and occurred in April 2007, with pricing
      (LIBOR plus 2.00%) and amortization profile of such term loan matching the
      New
      Term Loan described above. The Charter Operating Credit Agreement also modified
      the quarterly consolidated leverage ratio to be less restrictive.





In
      March
      2007, CCO Holdings entered into a credit agreement (the “CCO Holdings Credit
      Agreement”) which consisted of a $350 million term loan facility (the “Term
      Facility”). The Term Facility matures in September 2014 (the “Maturity Date”).
      The CCO Holdings Credit Agreement also provides for additional incremental
      term
      loans (the “Incremental Loans”) maturing on the dates set forth in the notices
      establishing such term loans, but no earlier than the Maturity Date. Borrowings
      under the CCO Holdings Credit Agreement bear interest at a variable interest
      rate based on either LIBOR or a base rate plus, in either case, an applicable
      margin. The applicable margin for LIBOR term loans, other than Incremental
      Loans, is 2.50% above LIBOR. The applicable margin with respect to Incremental
      Loans is to be agreed upon by CCO Holdings and the lenders when the Incremental
      Loans are established. The CCO Holdings Credit Agreement is secured by the
      equity interests of Charter Operating, and all proceeds thereof. As part of
      the
      refinancing, the existing $350 million revolving/term credit facility was
      terminated. A $1 million loss was recognized related to the write-off of
      unamortized deferred debt financing costs related to this facility.





**7.**  **Loans
      Payable-Related Party**





Loans
      payable-related party as of March 31, 2007 and December 31, 2006 consists of
      loans from Charter Holdco to the Company of $4 million and $3 million,
      respectively, from Charter Holdings to the Company of $113 million and $105
      million, respectively, and from CCH II to the Company of $209 million and $195
      million. These loans bear interest at a rate of LIBOR plus 3.0% reset quarterly.
      These loans are subject to certain limitations and may be repaid with borrowings
      under the Company’s revolving credit facility.





**8.**  **Minority
      Interest**





Minority
      interest on the Company’s condensed consolidated balance sheets at March 31,
      2007 and December 31, 2006 primarily represents
      preferred membership interests in CC VIII, LLC ("CC VIII"), an indirect
      subsidiary of CCO Holdings, of $646 million and $641 million, respectively. This
      preferred interest is held by Mr. Allen, Charter’s Chairman and controlling
      shareholder, and CCH I. Minority interest in the accompanying condensed
      consolidated statements of operations includes the 2% accretion of the preferred
      membership interests plus approximately 18.6% of CC VIII’s income, net of
      accretion.




**9.   Comprehensive
      Loss**




The
      Company reports changes in the fair value of interest rate agreements designated
      as hedging the variability of cash flows associated with floating-rate debt
      obligations, that meet the effectiveness criteria of SFAS No. 133, *Accounting
      for Derivative Instruments and Hedging Activities* ,
      in
      accumulated other comprehensive income (loss). Comprehensive loss was $46
      million and $182 million for the three months ended March 31, 2007 and 2006,
      respectively.


12
 **CCO
          HOLDINGS, LLC AND SUBSIDIARIES**
 **NOTES
          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **(UNAUDITED)**
 **(dollars
          in millions, except where indicated)**




**10.   Accounting
      for Derivative Instruments and Hedging Activities**




The
      Company uses interest rate risk management derivative instruments, including
      but
      not limited to interest rate swap agreements and interest rate collar agreements
      (collectively referred to herein as interest rate agreements) to manage its
      interest costs. The Company’s policy is to manage its exposure to fluctuations
      in interest rates by maintaining a mix of fixed and variable rate debt within
      a
      targeted range. Using interest rate swap agreements, the Company has agreed
      to
      exchange, at specified intervals through 2013, the difference between fixed
      and
      variable interest amounts calculated by reference to agreed-upon notional
      principal amounts.





The
      Company’s hedging policy does not permit it to hold or issue derivative
      instruments for trading purposes. The Company does, however, have certain
      interest rate derivative instruments that have been designated as cash flow
      hedging instruments. Such instruments effectively convert variable interest
      payments on certain debt instruments into fixed payments. For qualifying hedges,
      SFAS No. 133 allows derivative gains and losses to offset related results on
      hedged items in the consolidated statement of operations. The Company has
      formally documented, designated and assessed the effectiveness of transactions
      that receive hedge accounting. For the three months ended March
      31 ,
      2007
      and 2006, other income (expense), net includes $0 and gains of $2 million,
      respectively, which represent cash flow hedge ineffectiveness on interest rate
      hedge agreements. This ineffectiveness arises from differences between critical
      terms of the agreements and the related hedged obligations. Changes in the
      fair
      value of interest rate agreements designated as hedging instruments of the
      variability of cash flows associated with floating rate debt obligations that
      meet the effectiveness criteria of SFAS No. 133 are reported in accumulated
      other comprehensive income (loss). For the three months ended March
      31 ,
      2007
      and 2006, losses of $2 million and $1 million, respectively, related to
      derivative instruments designated as cash flow hedges, were recorded in
      accumulated other comprehensive income (loss). The amounts are subsequently
      reclassified into interest expense as a yield adjustment in the same periods
      in
      which the related interest on the floating-rate debt obligations affects
      earnings (losses).





Certain
      interest rate derivative instruments are not designated as hedges as they do
      not
      meet the effectiveness criteria specified by SFAS No. 133. However, management
      believes such instruments are closely correlated with the respective debt,
      thus
      managing associated risk. Interest rate derivative instruments not designated
      as
      hedges are marked to fair value, with the impact recorded as other income
      (expense) in the Company’s condensed consolidated statements of operations. For
      the three months ended March
      31 ,
      2007
      and 2006, other income (expense), net, includes losses of $1 million and gains
      of $6 million, respectively, resulting from interest rate derivative instruments
      not designated as hedges.





As
      of March
      31 ,
      2007
      and December 31, 2006, the Company had outstanding $3.4 billion and $1.7
      billion, respectively, in notional amounts of interest rate swaps. The notional
      amounts of interest rate instruments do not represent amounts exchanged by
      the
      parties and, thus, are not a measure of exposure to credit loss. The amounts
      exchanged are determined by reference to the notional amount and the other
      terms
      of the contracts.





**11.** **Other
      Operating Expenses, Net**





Other
      operating expenses, net consist of the following for the three months ended
      March 31, 2007 and 2006:





**Three
                Months**
              **Ended
                March 31,****2007**
            
            **2006**Loss
                on sale of assets, net
            
            $
            3
            
            $
            --Special
                charges, net
            
            
            1
            
            
            3$
            4
            
            $
            3




13
 **CCO
          HOLDINGS, LLC AND SUBSIDIARIES**
 **NOTES
          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **(UNAUDITED)**
 **(dollars
          in millions, except where indicated)**




Special
      charges, net for the three months ended March 31, 2007 and 2006 primarily
      represent severance associated with the closing of call centers and divisional
      restructuring.




**12.   Other
      Income
      (Expense), Net**




Other
      income (expense), net consists of the following for the three months ended
      March
      31, 2007 and 2006:




**Three
                Months**
              **Ended
                March 31,****2007**
            
            **2006**Gain
                (loss) on derivative instruments and
              hedging
                activities, net
            
            $
            (1
            )
            $
            8Loss
                on extinguishment of debt
            
            
            (1
            )
            
            --Minority
                interest
            
            
            (5
            )
            
            (4
            )Other,
                net
            
            
            --
            
            
            2$
            (7
            )
            $
            6




**13.  Income
      Taxes**




CCO
      Holdings is a single member limited liability company not subject to income
      tax.
      CCO Holdings holds all operations through indirect subsidiaries. The majority
      of
      these indirect subsidiaries are limited liability companies that are also not
      subject to income tax. However, certain of CCO Holdings’ indirect subsidiaries
      are corporations that are subject to income tax.





As
      of
      March 31, 2007 and December 31, 2006, the Company had net deferred income tax
      liabilities of approximately $200 million. The deferred tax liabilities relate
      to certain of the Company’s indirect subsidiaries, which file separate income
      tax returns.





During
      each of the three months ended March 31, 2007 and 2006, the Company recorded
      $2
      million of income tax expense. Income
      tax expense is recognized through current federal and state income tax expense
      as well as increases to the deferred tax liabilities of certain of the Company’s
      indirect corporate subsidiaries.





Charter
      Holdco is currently under examination by the Internal Revenue Service for the
      tax years ending December 31, 2003 and 2002. In
      addition, one of the Company’s indirect corporate subsidiaries is under
      examination by the Internal Revenue Service for the tax year ended December
      31,
      2004. The
      Company’s results (excluding the indirect corporate subsidiaries, with the
      exception of the indirect corporate subsidiary under examination) for these
      years are subject to this examination. Management does not expect the results
      of
      this examination to have a material adverse effect on the Company’s consolidated
      financial condition or results of operations.





**14.**  **Contingencies**




The
        Company and its parent companies are defendants or co-defendants in several
        unrelated lawsuits claiming infringement of various patents relating to various
        aspects of its businesses. Other industry participants are also defendants
        in
        certain of these cases, and, in many cases, the Company expects that any
        potential liability would be the responsibility of its equipment vendors
        pursuant to applicable contractual indemnification provisions. In the event
        that
        a court ultimately determines that the Company infringes on any intellectual
        property rights, it may be subject to substantial damages and/or an injunction
        that could require the Company or its vendors to modify certain products
        and
        services the Company offers to its subscribers. While the Company believes
        the
        lawsuits are without merit and intends to defend the actions vigorously,
        the
        lawsuits could be material to the Company’s consolidated results of operations
        of
  14
 **CCO
            HOLDINGS, LLC AND SUBSIDIARIES**
 **NOTES
            TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **(UNAUDITED)**
 **(dollars
            in millions, except where indicated)**
  any
        one
        period, and no assurance can be given that any adverse outcome would not
        be
        material to the Company’s consolidated financial condition, results of
        operations, or liquidity.




The
      Company and its parent companies are party to other lawsuits and claims that
      arise in the ordinary course of conducting its business. The ultimate outcome
      of
      these other legal matters pending against the Company or its subsidiaries cannot
      be predicted, and although such lawsuits and claims are not expected
      individually to have a material adverse effect on the Company’s consolidated
      financial condition, results of operations, or liquidity, such lawsuits could
      have, in the aggregate, a material adverse effect on the Company’s consolidated
      financial condition, results of operations, or liquidity.





**15.**  **Stock
      Compensation Plans**





Charter
      has stock option plans (the “Plans”) which provide for the grant of
      non-qualified stock options, stock appreciation rights, dividend equivalent
      rights, performance units and performance shares, share awards, phantom stock
      and/or restricted stock (not to exceed 20,000,000 shares of Charter Class A
      common stock), as each term is defined in the Plans. Employees, officers,
      consultants and directors of the Charter and its subsidiaries and affiliates
      are
      eligible to receive grants under the Plans. Options granted generally vest
      over
      four years from the grant date, with 25% generally vesting on the anniversary
      of
      the grant date and ratably thereafter. Generally, options expire 10 years
      from the grant date. The Plans allow for the issuance of up to a total of
      90,000,000 shares of Charter Class A common stock (or units convertible
      into Charter Class A common stock). During the three months ended March 31,
      2007, Charter granted 3.8 million stock options and 6.7 million performance
      units under Charter’s Long-Term Incentive Program. The
      Company recorded $5 million and $4 million of stock compensation expense which
      is included in selling, general, and administrative expense for the three months
      ended March 31, 2007 and 2006, respectively.





15





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





**General**





CCO
      Holdings, LLC ( " CCO
      Holdings " )
      is a
      holding company whose principal assets at March 31, 2007 are the equity
      interests in its operating subsidiaries. CCO Holdings is a direct subsidiary
      of
      CCH II, LLC (“CCH II”), which is an indirect subsidiary of Charter
      Communications Holdings, LLC ( " Charter
      Holdings " ) .
      Charter
      Holdings is an indirect subsidiary of Charter Communications, Inc.
      (“Charter”) . " We, "  " us " and " our " refer to
      CCO Holdings and/or its subsidiaries.





We
      are a
      broadband communications company operating in the United States. We offer our
      residential and commercial customers traditional cable video programming (analog
      and digital video, which we refer to as “video service”), high-speed Internet
      services, advanced broadband cable services (such as Charter OnDemandTM video
      service (“OnDemand”), high definition television service, and digital video
      recorder (“DVR”) service) and, in many of our markets, telephone service. We
      sell our cable video programming, high-speed Internet, telephone, and advanced
      broadband services on a subscription basis.





The
      following table summarizes our customer statistics for analog and digital video,
      residential high-speed Internet and residential telephone as of March
      31,
      2007 and 2006 :





**Approximate
                as of****March
                31,**
            
            **March
                31,****2007
                (a)**
            
            **2006
                (a)****Video
                Cable Services:****Analog
                Video:**Residential
                (non-bulk) analog video customers (b)
            
            
            5,146,700
            
            
            5,640,200Multi-dwelling
                (bulk) and commercial unit customers (c)
            
            
            268,700
            
            
            273,700Total
                analog video customers (b)(c)
            
            
            5,415,400
            
            
            5,913,900**Digital
                Video:**Digital
                video customers (d)
            
            
            2,862,900
            
            
            2,866,400**Non-Video
                Cable Services:**Residential
                high-speed Internet customers (e)
            
            
            2,525,900
            
            
            2,322,400Residential
                telephone customers (f)
            
            
            572,600
            
            
            191,100





After
      giving effect to sales of certain non-strategic cable systems in the third
      quarter of 2006 and in January 2007, analog video customers, digital video
      customers, high-speed Internet customers and telephone customers would have
      been
      5,478,600, 2,683,500, 2,203,000 and 191,100, respectively, as of March 31,
      2006.


(a)
              "Customers"
                  include all persons our corporate billing records show as receiving
                  service (regardless of their payment status), except for complimentary
                  accounts (such as our employees). At March 31, 2007 and 2006, "customers"
                  include approximately 31,700 and 48,500 persons whose accounts
                  were over
                  60 days past due in payment, approximately 4,100 and 11,900 persons
                  whose
                  accounts were over 90 days past due in payment, and approximately
                  2,000
                  and 7,800 of which were over 120 days past due in payment, respectively.




(b)
            "Analog
                  video customers" include all customers who receive video
                  services.




(c)
            Included
                within "video customers" are those in commercial and multi-dwelling
                structures, which are calculated on an equivalent bulk unit ("EBU")
                basis.
                EBU is calculated for a system by dividing the bulk price charged
                to
                accounts in an area by the most prevalent price charged to non-bulk
                residential customers in that market for the comparable tier of service.
                The EBU method of estimating analog video customers is consistent
                with the
                methodology used in determining costs paid to programmers and has
                been
                used consistently.




16





(d)
            "Digital
                video customers" include all households that have one or more digital
                set-top boxes or cable cards deployed.





(e)
            "Residential
                high-speed Internet customers" represent those residential customers
                who
                subscribe to our high-speed Internet service.





(f)
            "Residential
                telephone customers" include all residential customers receiving
                telephone
                service.





**Overview**




For
      the
      three months ended March 31, 2007, our operating income from continuing
      operations was $156 million, and for the three months ended March 31, 2006,
      our
      operating loss from continuing operations was $8 million. We had an operating
      margin of 11% for the three months ended March 31, 2007 and a negative operating
      margin of 1% for the three months ended March 31, 2006. The increase in
      operating income from continuing operations and operating margins for the three
      months ended March 31, 2007 compared to the three months ended, March 31, 2006
      was principally due to asset impairment charges during 2006, which did not
      recur
      in 2007, combined with revenues increasing at a faster rate than expenses,
      reflecting increased operational efficiencies, improved geographic footprint,
      and benefits from improved third party contracts.





We
      have a
      history of net losses. Further, we expect to continue to report net losses
      for
      the foreseeable future. Our net losses are principally attributable to
      insufficient revenue to cover the combination
      of operating expenses and interest
      expenses we incur because of our high level of debt and depreciation expenses
      that we incur resulting from the capital investments we have made and continue
      to make in our cable properties. We expect that these expenses will remain
      significant.





**Sale
      of Assets**





In
      2006,
      we sold cable systems serving a total of approximately 356,000 analog video
      customers for a total sales price of approximately $971 million. The Company
      used the net proceeds from the asset sales to reduce borrowings, but not
      commitments, under the revolving portion of the Company’s credit facilities.
      These cable systems met the criteria for assets held for sale. As such, the
      assets were written down to fair value less estimated costs to sell resulting
      in
      asset impairment charges during the three months ended March 31, 2006 of
      approximately $99 million. The results of operations for the West Virginia
      and
      Virginia cable systems have been presented as discontinued operations, net
      of
      tax for the three months ended March 31, 2006.





**Critical
      Accounting Policies and Estimates**





For
      a
      discussion of our critical accounting policies and the means by which we develop
      estimates therefore, see "Item 7. Management’s Discussion and Analysis of
      Financial Condition and Results of Operations" in our 2006 Annual Report on
      Form
      10-K.





17


**RESULTS
      OF OPERATIONS**





***Three
      Months Ended*** ***March
      31, 2007*** ***Compared to Three Months Ended March 31, 2006***





The
      following table sets forth the percentages of revenues that items in the
      accompanying condensed consolidated statements of operations constituted for
      the
      periods presented (dollars in millions):





**Three
                Months Ended March 31,****2007**
            
            **2006**Revenues
            
            $
            1,425
            
            
            100
            %
            $
            1,320
            
            
            100
            %Costs
                and expenses:Operating
                (excluding depreciation and amortization)
            
            
            631
            
            
            44
            %
            
            604
            
            
            46
            %Selling,
                general and administrative
            
            
            303
            
            
            21
            %
            
            272
            
            
            21
            %Depreciation
                and amortization
            
            
            331
            
            
            24
            %
            
            350
            
            
            26
            %Asset
                impairment charges
            
            
            --
            
            
            --
            
            
            99
            
            
            8
            %Other
                operating expenses, net
            
            
            4
            
            
            --
            
            
            3
            
            
            --1,269
            
            
            89
            %
            
            1,328
            
            
            101
            %Operating
                income (loss) from continuing operations
            
            
            156
            
            
            11
            %
            
            (8
            )
            
            (1
            )%Interest
                expense, net
            
            
            (190
            )
            
            
            
            
            (192
            )Other
                income (expense), net
            
            
            (7
            )
            
            
            
            
            6(197
            )
            
            
            
            
            (186
            )Loss
                from continuing operations before income taxes
            
            
            (41
            )
            
            
            
            
            (194
            )Income
                tax expense
            
            
            (2
            )
            
            
            
            
            (2
            )Loss
                from continuing operations
            
            
            (43
            )
            
            
            
            
            (196
            )Income
                from discontinued operations, net of tax
            
            
            --
            
            
            
            
            
            15Net
                loss
            
            $
            (43
            )
            
            
            
            $
            (181
            )





***Revenues*** . Average
      monthly revenue per analog video customer increased to $88 for the three months
      ended March
      31,
      2007 from $78
      for the three months ended March
      31,
      2006 primarily as a result of incremental revenues from OnDemand, DVR, and
      high-definition television services and rate adjustments. Average monthly
      revenue per analog video customer represents total quarterly revenue, divided
      by
      three, divided by the average number of analog video customers during the
      respective period.





Revenues
      by service offering were as follows (dollars in millions):




**Three
                  Months Ended March 31,****2007**
              
              **2006**
              
              **2007
                  over 2006****Revenues**
              
              **%
                  of**
                **Revenues**
              
              **Revenues**
              
              **%
                  of**
                **Revenues**
              
              **Change**
              
              **%
                  Change**Video
              
              $
              838
              
              
              59
              %
              $
              831
              
              
              63
              %
              $
              7
              
              
              1
              %High-speed
                  Internet
              
              
              296
              
              
              21
              %
              
              245
              
              
              19
              %
              
              51
              
              
              21
              %Telephone
              
              
              63
              
              
              4
              %
              
              20
              
              
              1
              %
              
              43
              
              
              215
              %Advertising
                  sales
              
              
              63
              
              
              4
              %
              
              68
              
              
              5
              %
              
              (5
              )
              
              (7
              %)Commercial
              
              
              81
              
              
              6
              %
              
              73
              
              
              6
              %
              
              8
              
              
              11
              %Other
              
              
              84
              
              
              6
              %
              
              83
              
              
              6
              %
              
              1
              
              
              1
              %$
              1,425
              
              
              100
              %
              $
              1,320
              
              
              100
              %
              $
              105
              
              
              8
              %


18




Video
      revenues consist primarily of revenues from analog and digital video services
      provided to our non-commercial customers. Analog video customers decreased
      by
      255,900 customers from March 31, 2006, 192,700 of which was related to asset
      sales, compared to March 31, 2007, while digital video customers increased
      by
      116,400, offset by a loss of 62,900 customers related to asset sales. The
      increase in video revenues is attributable to the following (dollars in
      millions):




**2007
                  compared to 2006**
                **Increase
                  / (Decrease)**Rate
                  adjustments and incremental video services
              
              $
              23Increase
                  in digital video customers
              
              
              16Decrease
                  in analog video customers
              
              
              (10
              )System
                  sales
              
              
              (22
              )$
              7


High-speed
      Internet customers grew by 285,600 customers, offset by a loss of 37,200
      customers related to asset sales, from March 31, 2006 to March 31, 2007. The
      increase in high-speed Internet revenues from our non-commercial customers
      is
      attributable to the following (dollars in millions):





**2007
                compared to 2006**
              **Increase
                / (Decrease)**Increase
                in high-speed Internet customers
            
            $
            37Price
                increases
            
            
            18System
                sales
            
            
            (4
            )$
            51





Revenues
      from telephone services increased primarily as a result of an increase of
      381,500 telephone customers from March 31, 2006 to March 31, 2007.





Advertising
      sales revenues consist primarily of revenues from commercial advertising
      customers, programmers and other vendors. Advertising sales revenues decreased
      primarily as a result of a decrease in national advertising sales. For the
      three
      months ended March 31, 2007 and 2006, we received $4 million and $6 million,
      respectively, in advertising sales revenues from programmers.





Commercial
      revenues consist primarily of revenues from cable video and high-speed Internet
      services provided to our commercial customers. Commercial revenues increased
      primarily as a result of an increase in commercial high-speed Internet revenues
      offset by a decrease of $3 million related to asset sales.





Other
      revenues consist of revenues from franchise fees, equipment rental, customer
      installations, home shopping, dial-up Internet service, late payment fees,
      wire
      maintenance fees and other miscellaneous revenues. For the three months ended
      March 31, 2007 and 2006, franchise fees represented approximately 51% and 53%,
      respectively, of total other revenues. The increase in other revenues was
      primarily the result of increases in wire maintenance fees.


19


***Operating
      expenses*** **.** The
      increase in operating expenses is attributable to the following (dollars in
      millions):





**2007
                compared to 2006**
              **Increase
                / (Decrease)**Programming
                costs
            
            $
            28Costs
                of providing high-speed Internet and telephone services
            
            
            9Maintenance
                costs
            
            
            4Advertising
                sales costs
            
            
            2Other,
                net
            
            
            1System
                sales
            
            
            (18
            )$
            26





Programming
      costs were approximately $393 million and $376 million, representing 62% of
      total operating expenses for the three months ended March 31, 2007 and 2006,
      respectively. Programming costs consist primarily of costs paid to programmers
      for analog, premium, digital, OnDemand, and pay-per-view programming. The
      increase in programming costs is primarily a result of contractual rate
      increases. Programming costs were offset by the amortization of payments
      received from programmers in support of launches of new channels of $5 million
      for each of the three months ended March 31, 2007 and 2006, respectively. We
      expect programming expenses to continue to increase due to a variety of factors,
      including annual increases imposed by programmers, and additional programming,
      including high-definition and OnDemand programming, being provided to customers.





***Selling,
      general and administrative expenses.*** ** The
      increase in selling, general and administrative expenses is attributable to
      the
      following (dollars in millions):


**2007
                  compared to 2006**
                **Increase
                  / (Decrease)**Customer
                  care costs
              
              $
              18Marketing
                  costs
              
              
              18Employee
                  costs
              
              
              7Professional
                  service costs
              
              
              (8
              )Other,
                  net
              
              
              1System
                  sales
              
              
              (5
              )$
              31
 ***Depreciation
        and amortization.*** ** Depreciation
        and amortization expense decreased by $19 million and was primarily the result
        of systems sales and certain assets becoming fully depreciated.





***Asset
      impairment charges.*** Asset
      impairment charges for the three months ended March 31, 2006 represent the
      write-down of assets related to cable asset sales to fair value less costs
      to
      sell. See Note 3 to the accompanying condensed consolidated financial statements
      contained in “Item 1. Financial Statements.”





***Other
      operating expenses, net.*** The
      increase in other operating expenses, net is attributable to the following
      (dollars in millions):





**2007
                compared**
              **to
                2006**Increase
                in losses on sales of assets
            
            $
            3Decrease
                in special charges, net
            
            
            (2
            )$
            1




20




For
      more
      information, see Note 11 to the accompanying condensed consolidated financial
      statements contained in “Item 1. Financial Statements.”





***Interest
      expense, net.*** ** Net
      interest expense decreased by $2 million, which was a result of a decrease
      in
      our average borrowing rate from 8.2% in the first quarter of 2006 to 7.9% in
      the
      first quarter of 2007. Average debt outstanding was $8.7 billion for the first
      quarter of 2006 and 2007.





***Other
      income (expense), net.*** The
      change in other income (expense), net is attributable to the following (dollars
      in millions):


**2007
                  compared**
                **to
                  2006**Decrease
                  in gain on derivative instruments and
                hedging
                  activities, net
              
              $
              (9
              )Increase
                  in loss on extinguishment of debt
              
              
              (1
              )Increase
                  in minority interest
              
              
              (1
              )Other,
                  net
              
              
              (2
              )$
              (13
              )


For
      more
      information, see Note 12 to the accompanying condensed consolidated financial
      statements contained in “Item 1. Financial Statements.”





***Income
      tax expense.*** ** Income
      tax expense was recognized through increases in deferred tax liabilities and
      current federal and state income tax expenses of our indirect corporate
      subsidiaries.





***Income
      from discontinued operations, net of tax.*** Income
      from discontinued operations, net of tax decreased in the first quarter of
      2007
      compared to the first quarter of 2006 due to the sale of the West Virginia
      and
      Virginia systems in July 2006. For
      more
      information, see Note 3 to the accompanying condensed consolidated financial
      statements contained in “Item 1. Financial Statements.”





***Net
      loss.*** ** The
      impact to net loss in the three months ended March 31, 2007 and 2006 of asset
      impairment charges and extinguishment of debt was to increase net loss by
      approximately $1 million and $99 million, respectively.





**Liquidity
      and Capital Resources**




***Introduction*** ****




This
      section contains a discussion of our liquidity and capital resources, including
      a discussion of our cash position, sources and uses of cash, access to credit
      facilities and other financing sources, historical financing activities, cash
      needs, capital expenditures and outstanding debt.




Our
      long-term financing as of March 31, 2007 consists of $5.6 billion of credit
      facility debt and $3.2 billion accreted value of high-yield notes. For the
      remaining three quarterly periods of 2007, none of our debt matures. In each
      of
      2008 and 2009, $55 million of our debt matures. In 2010 and beyond, significant
      additional amounts will become due under our remaining long-term debt
      obligations.





Our
      business requires significant cash to fund debt service costs, capital
      expenditures and ongoing operations. We have historically funded these
      requirements through cash flows from operating activities, borrowings under
      our
      credit facilities, equity contributions from our parent companies, sales of
      assets, issuances of debt securities and cash on hand. However, the mix of
      funding sources changes from period to period. For the three months ended
      March 31, 2007, we generated $436 million of net cash flows from operating
      activities after paying cash interest of $135 million. In addition, we used
      approximately $298 million for purchases of property, plant and equipment.
      Finally, we had net cash flows used in financing activities of $80 million.
      We
      expect that our mix of sources of funds will continue to change in the future
      based on overall needs relative to our cash flow and on the availability of
      funds under our credit facilities, our and our parent companies’ access to the
      debt and equity markets, the timing of possible asset sales and our ability
      to
      generate cash flows from operating activities. We continue to explore asset




21




dispositions
      as one of several possible actions that we could take in the future to improve
      our liquidity, but we do not presently believe future asset sales to be a
      significant source of liquidity.





We
      expect
      that cash on hand, cash flows from operating activities, and the amounts
      available under our credit facilities will be adequate to meet our and our
      parent companies’ cash needs through 2008.  We believe that cash flows from
      operating activities and amounts available under our credit facilities may
      not
      be sufficient to fund our operations and satisfy our and our parent companies’
interest and principal repayment obligations in 2009 and will not be sufficient
      to fund such needs in 2010 and beyond. We have been advised that Charter
      continues to work with its financial advisors concerning its approach to
      addressing liquidity, debt maturities and its overall balance sheet leverage.





***Credit
      Facility Availability***





Our
      ability to operate depends upon, among other things, our continued access to
      capital, including credit under the Charter Communications Operating, LLC
      (“Charter Operating”) credit facilities. The Charter Operating credit
      facilities, along with our indentures and the CCO Holdings credit facilities,
      contain certain restrictive covenants, some of which require us to maintain
      specified leverage ratios and meet financial tests and to provide annual audited
      financial statements with an unqualified opinion from our independent auditors.
      As of March 31, 2007, we are in compliance with the covenants under our
      indentures and credit facilities, and we expect to remain in compliance with
      those covenants for the next twelve months. As of March 31, 2007, our potential
      availability under our revolving credit facility totaled approximately $1.4
      billion, none of which was limited by covenant restrictions. Continued access
      to
      our credit facilities is subject to our remaining in compliance with these
      covenants, including covenants tied to our leverage ratio. If any events of
      non-compliance occur, funding under the credit facilities may not be available
      and defaults on some or potentially all of our debt obligations could occur.
      An
      event of default under any of our debt instruments could result in the
      acceleration of our payment obligations under that debt and, under certain
      circumstances, in cross-defaults under our other debt obligations, which could
      have a material adverse effect on our consolidated financial condition and
      results of operations.





***Parent
      Company Debt Obligations***





Any
      financial or liquidity problems of our parent companies could cause serious
      disruption to our business and have a material adverse effect on our business
      and results of operations. A failure by Charter Holdings, CCH I Holdings, LLC
      (“CIH”), CCH I, LLC (“CCH I”), or CCH II to satisfy their debt payment
      obligations or a bankruptcy with respect to Charter Holdings, CIH, CCH I, or
      CCH
      II would give the lenders under our credit facilities the right to accelerate
      the payment obligations under these facilities. Any such acceleration would
      be a
      default under the indenture governing our notes. On a consolidated basis, our
      parent companies have a significant level of debt, which, including our debt,
      totaled approximately $19.3 billion as of March 31, 2007.





***Limitations
      on Distributions***





As
      long
      as Charter’s convertible notes remain outstanding and are not otherwise
      converted into shares of common stock, Charter must pay interest on the
      convertible senior notes and repay the principal amount in November 2009. Charter’s
      ability to make interest payments on its convertible senior notes, and, in
      2009,
      to repay the outstanding principal of its convertible senior notes of $413
      million, net of $450 million of convertible senior notes held by CCHC, LLC
      (“CCHC”), will depend on its ability to raise additional capital and/or on
      receipt of payments or distributions from Charter Communications Holding
      Company, LLC (“Charter Holdco”) and its subsidiaries. As
      of March 31, 2007, Charter Holdco was owed $4 million in intercompany loans
      from
      its subsidiaries and had $8 million in cash, which were available to pay
      interest and principal on Charter's convertible senior notes.  In
      addition, Charter has $50 million of U.S. government securities pledged as
      security for the semi-annual interest payments on Charter’s convertible senior
      notes scheduled in 2007.  As long as CCHC continues to hold the $450
      million of Charter’s convertible senior notes, CCHC will receive interest
      payments from the government securities pledged for the convertible senior
      notes.  The cumulative amount of interest payments expected to be received
      by CCHC is $40 million and may be available to be distributed to pay semiannual
      interest due in 2008 and May 2009 on the outstanding principal amount of $413
      million of Charter’s convertible senior notes, although CCHC may use those
      amounts for other purposes.





As
      of
      March 31, 2007, Charter Holdings, CIH, CCH I, and CCH II had approximately
      $9.9
      billion principal amount of high-yield notes outstanding with approximately
      $0,
      $415 million, $2.3 billion, and $7.2 billion maturing in 2008,




22




2009,
      2010, and thereafter, respectively. Charter Holdings, CIH, CCH I, and CCH II
      will need to raise additional capital or receive distributions or payments
      from
      us in order to satisfy their debt obligations. However, because of their
      significant indebtedness, our ability, and the ability of the parent companies
      to raise additional capital at reasonable rates or at all is uncertain. During
      the three months ended March 31, 2007, we distributed $280 million of cash
      to
      our parent company.





Distributions
      by Charter’s subsidiaries to a parent company (including Charter, Charter
      Holdco, CCHC, Charter Holdings, CIH, CCH I, and CCH II) for
      payment of principal on parent company notes, are
      restricted under the indentures governing the CIH notes, CCH I notes, CCH II
      notes, CCO Holdings notes, and Charter Operating notes and under the CCO
      Holdings credit facilities unless
      there is no default under the applicable indenture and credit facilities, and
      each applicable subsidiary’s leverage ratio test is met at the time of such
      distribution. For
      the
      quarter ended March 31, 2007, there was no default under any of these indentures
      or credit facilities. However, certain of Charter’s subsidiaries did not meet
      their applicable leverage ratio tests based on March 31, 2007 financial results.
      As a result, distributions from certain of Charter’s subsidiaries to their
      parent companies would have been restricted at such time and will continue
      to be
      restricted unless those tests are met. Distributions by Charter Operating for
      payment of principal on parent company notes are further restricted by the
      covenants in its credit facilities.





Distributions
      by CIH, CCH I, CCH II, CCO Holdings and Charter Operating to a parent company
      for payment of parent company interest are permitted if there is no default
      under the aforementioned indentures and CCO Holdings Credit facilities.





The
      indentures governing the Charter Holdings notes permit Charter Holdings to
      make
      distributions to Charter Holdco for payment of interest or principal on
      Charter’s convertible senior notes, only if, after giving effect to the
      distribution, Charter Holdings can incur additional debt under the leverage
      ratio of 8.75 to 1.0, there is no default under Charter Holdings’ indentures,
      and other specified tests are met. For the quarter ended March
      31,
      2007, there was no default under Charter Holdings’ indentures and the other
      specified tests were met. However,
      Charter Holdings did not meet the leverage ratio test of 8.75 to 1.0 based
      on
      March 31, 2007 financial results. As a result, distributions from Charter
      Holdings to Charter or Charter Holdco would have been restricted at such time
      and will continue to be restricted unless that test is met. During periods
      in which distributions are restricted, the
      indentures governing the Charter Holdings notes permit Charter Holdings and
      its
      subsidiaries to make specified investments (that are not restricted payments)
      in
      Charter Holdco or Charter, up to an amount determined by a formula, as long
      as
      there is no default under the indentures.





In
      addition to the limitation on distributions under the various indentures
      discussed above, distributions by our subsidiaries may be limited by applicable
      law. See “Risk Factors —
Because
      of our holding company structure, our outstanding notes are structurally
      subordinated in right of payment to all liabilities of our subsidiaries.
      Restrictions in our subsidiary’s debt instruments and under applicable law limit
      their ability to provide funds to us or our various debt issuers.”





***Access
      to Capital***





Our
      ability to incur additional debt may be limited by the restrictive covenants
      in
      our indentures and credit facilities. No assurances can be given that we will
      not experience liquidity problems if we do not obtain sufficient additional
      financing on a timely basis as our debt becomes due or because of adverse market
      conditions, increased competition or other unfavorable events. If, at any time,
      additional capital or borrowing capacity is required beyond amounts internally
      generated or available under our credit facilities or through additional debt
      or
      equity financings, we would consider:





•
            issuing
                equity at a parent company level, the proceeds of which could be
                loaned or
                contributed to us;•
            issuing
                debt securities that may have structural or other priority over our
                existing notes;•
            further
                reducing our expenses and capital expenditures, which may impair
                our
                ability to increase revenue and grow operating cash flows;•
            selling
                assets; or•
            requesting
                waivers or amendments with respect to our credit facilities, which
                may not
                be available on acceptable terms; and cannot be assured.




23




If
      the
      above strategies are not successful, we could be forced to restructure our
      obligations or seek protection under the bankruptcy laws. In addition, if we
      find it necessary to engage in a recapitalization or other similar transaction,
      our noteholders might not receive principal and interest payments to which
      they
      are contractually entitled.





***Recent
      Financing Transactions*** ****





On
      March
      6, 2007, Charter Operating entered into an Amended and Restated Credit Agreement
      among Charter Operating, CCO Holdings, the several lenders from time to time
      that are parties thereto, JPMorgan Chase Bank, N.A., as administrative agent,
      and certain other agents (the “Charter Operating Credit
      Agreement”).





The
      Charter Operating Credit Agreement provides for a $1.5 billion senior secured
      revolving line of credit, a continuation of the existing $5.0 billion term
      loan
      facility (which was refinanced with new term loans in April 2007), and a $1.5
      billion new term loan facility (the “New Term Loan”) which was funded in March
      and April 2007. Borrowings under the Charter Operating Credit Agreement bear
      interest at a variable interest rate based on either LIBOR or a base rate,
      plus
      in either case, an applicable margin. The applicable margin for LIBOR loans
      under the New Term Loan and revolving loans is 2.00% above LIBOR. The revolving
      line of credit commitments terminate on March 6, 2013. The Existing Term Loan
      and the New Term Loan are subject to amortization at 1% of their initial
      principal amount per annum. The New Term Loan amortization commences on March
      31, 2008. The remaining principal amount of the New Term Loan will be due on
      March 6, 2014.





The
      terms
      of the Existing Term Loan have been amended effective March 6, 2007. The
      refinancing of the $5.0 billion Existing Term Loan with new term loans
      (“Replacement Existing Term Loan”) was permitted under the Charter Operating
      Credit Agreement and occurred in April 2007, with pricing (LIBOR plus 2.00%)
      and
      amortization profile of the Replacement Existing Term Loan matching the New
      Term
      Loan described above. The Charter Operating Credit Agreement contains financial
      covenants requiring Charter Operating to maintain a quarterly consolidated
      leverage ratio not to exceed 5 to 1 and a first lien leverage ratio not to
      exceed 4 to 1.





On
      March
      6, 2007, CCO Holdings entered into a credit agreement among CCO Holdings, the
      several lenders from time to time that are parties thereto, Bank of America,
      N.A., as administrative agent, and certain other agents (the “CCO Holdings
      Credit Agreement”). The CCO Holdings Credit Agreement consists of a $350 million
      term loan facility (the “Term Facility”). The term loan matures on September 6,
      2014 (the “Maturity Date”). The CCO Holdings Credit Agreement also provides for
      additional incremental term loans (the “Incremental Loans”) maturing on the
      dates set forth in the notices establishing such term loans, but no earlier
      than
      the Maturity Date. Borrowings under the CCO Holdings Credit Agreement bear
      interest at a variable interest rate based on either LIBOR or a base rate plus,
      in either case, an applicable margin. The applicable margin for LIBOR term
      loans, other than Incremental Loans, is 2.50% above LIBOR. The applicable margin
      with respect to Incremental Loans is to be agreed upon by CCO Holdings and
      the
      lenders when the Incremental Loans are established. The CCO Holdings Credit
      Agreement is secured by the equity interests of Charter Operating, and all
      proceeds thereof.





We
      used a
      portion of the additional proceeds from the Charter Operating Credit Agreement
      and CCO Holdings Credit Agreement to redeem $550 million of CCO Holdings’
outstanding floating rate notes due 2010, to redeem approximately $187 million
      of Charter Holdings’ outstanding 8.625% senior notes due 2009, to fund the
      purchase of notes in a tender offer for total consideration (including premiums
      and accrued interest) of $100 million of certain notes outstanding at Charter
      Holdings, and to repay $105 million of Charter Holdings’ notes maturing in April
      2007. The remainder will be used for other general corporate purposes.





***Historical
      Operating, Financing and Investing Activities***





Our
      cash
      flows for the three months ended March 31, 2006 include the cash flows related
      to our discontinued operations.





We
      held
      $63 million in cash and cash equivalents as of March 31, 2007, compared to
      $28 million as of December 31, 2006. For the three months ended March 31,
      2007, we generated $436 million of net cash flows from operating activities
      after paying cash interest of $135 million. In addition, we used approximately
      $298 million for purchases of property, plant and equipment. Finally, we had
      net
      cash flows used in financing activities of $80 million.




***Operating
      Activities.*** ** Net
      cash
      provided by operating activities increased $113 million, or 35%, from $323
      million for the three months ended March 31, 2006 to $436 million for the three
      months ended March 31, 2007. For the




24




three
      months ended March 31, 2007, net cash provided by operating activities increased
      primarily as a result of revenues increasing at a faster rate than cash expenses
      and changes in operating assets and liabilities that provided $87 million more
      cash during the three months ended March 31, 2007 than the corresponding period
      in 2006, offset by an increase of $2 million in interest on cash pay obligations
      during the same period.





***Investing
      Activities.*** ** Net
      cash
      used by investing activities was $321 million for the three months ended March
      31, 2007 compared to net cash used by investing activities of $276 million
      for
      the three months ended March 31, 2006, which was primarily related to an
      increase in purchases of property, plant, and equipment.




***Financing
      Activities.*** ** Net
      cash
      used in financing activities was $80 million and $26 million for the three
      months ended March 31, 2007 and 2006, respectively. The increase in cash used
      during the three months ended March 31, 2007 as compared to the corresponding
      period in 2006, was primarily the result of increased
      distributions.





***Capital
      Expenditures*** ****





We
      have
      significant ongoing capital expenditure requirements. Capital expenditures
      were
      $298 million and $241 million for the three months ended March
      31,
      2007 and
      2006,
      respectively. Capital expenditures increased as a result of increased spending
      on customer premise equipment to meet increased customer growth and increases
      in
      scalable infrastructure as a result of high-speed data network upgrades and
      telephone headend equipment. See the table below for more details.




Our
      capital expenditures are funded primarily from cash flows from operating
      activities, the issuance of debt and borrowings under credit facilities. In
      addition, during the three months ended March
      31,
      2007 and
      2006, our liabilities related to capital expenditures decreased $32 million
      and
      $7 million, respectively.





During
      2007, we expect capital expenditures to be approximately $1.2 billion. We expect
      that the nature of these expenditures will continue to be composed primarily
      of
      purchases of customer premise equipment related to telephone and other advanced
      services, support capital and for scalable infrastructure costs. We have and
      expect to continue to fund capital expenditures for 2007 primarily from cash
      flows from operating activities and borrowings under our credit
      facilities.




We
      have
      adopted capital expenditure disclosure guidance, which was developed by eleven
      publicly traded cable system operators, including us, with the support of the
      National Cable & Telecommunications Association ("NCTA"). The disclosure is
      intended to provide more consistency in the reporting of operating statistics
      in
      capital expenditures and customers among peer companies in the cable industry.
      These disclosure guidelines are not required disclosure under Generally Accepted
      Accounting Principles ("GAAP"), nor do they impact our accounting for capital
      expenditures under GAAP.





The
      following table presents our major capital expenditures categories in accordance
      with NCTA disclosure guidelines for the three months ended March 31, 2007 and
      2006 (dollars in millions):





**Three
                Months Ended**
              **March
                31,****2007**
            
            **2006**Customer
                premise equipment (a)
            
            $
            161
            
            $
            130Scalable
                infrastructure (b)
            
            
            49
            
            
            34Line
                extensions (c)
            
            
            24
            
            
            26Upgrade/Rebuild
                (d)
            
            
            12
            
            
            9Support
                capital (e)
            
            
            52
            
            
            42Total
                capital expenditures
            
            $
            298
            
            $
            241




(a)
              Customer
                  premise equipment includes costs incurred at the customer residence
                  to
                  secure new customers, revenue units and additional bandwidth revenues.
                  It
                  also includes customer installation costs in accordance with SFAS
                  No. 51,*Financial
                  Reporting by Cable Television Companies,*and
                  customer premise equipment (e.g., set-top terminals and cable modems,
                  etc.).




25






(b)
            Scalable
                infrastructure includes costs, not related to customer premise equipment
                or our network, to secure growth of new customers, revenue units
                and
                additional bandwidth revenues or provide service enhancements (e.g.,
                headend equipment).


(c)
            Line
                extensions include network costs associated with entering new service
                areas (e.g., fiber/coaxial cable, amplifiers, electronic equipment,
                make-ready and design engineering).


(d)
            Upgrade/rebuild
                includes costs to modify or replace existing fiber/coaxial cable
                networks,
                including betterments.


(e)
            Support
                capital includes costs associated with the replacement or enhancement
                of
                non-network assets due to technological and physical obsolescence
                (e.g.,
                non-network equipment, land, buildings and
                vehicles).




**Item
      4.****Controls
      and Procedures.**





As
      of the
      end of the period covered by this report, management, including our Chief
      Executive Officer and Chief Financial Officer, evaluated the effectiveness
      of
      the design and operation of our disclosure controls and procedures with respect
      to the information generated for use in this quarterly report. The evaluation
      was based in part upon reports and certifications provided by a number of
      executives. Based upon, and as of the date of that evaluation, our Chief
      Executive Officer and Chief Financial Officer concluded that the disclosure
      controls and procedures were effective to provide reasonable assurances that
      information required to be disclosed in the reports we file or submit under
      the
      Securities Exchange Act of 1934 is recorded, processed, summarized and reported
      within the time periods specified in the Commission’s rules and forms.





There
      was
      no change in our internal control over financial reporting during the quarter
      ended March 31, 2007 that has materially affected, or is reasonably likely
      to
      materially affect, our internal control over financial reporting.





In
      designing and evaluating the disclosure controls and procedures, our management
      recognized that any controls and procedures, no matter how well designed and
      operated, can provide only reasonable, not absolute, assurance of achieving
      the
      desired control objectives and management necessarily was required to apply
      its
      judgment in evaluating the cost-benefit relationship of possible controls and
      procedures. Based upon the above evaluation, our management believes that our
      controls provide such reasonable assurances.


26


**PART
      II. OTHER INFORMATION.**





**Item
      1.****Legal
      Proceedings.**





We
      and
      our parent companies are defendants or co-defendants in several unrelated
      lawsuits claiming infringement of various patents relating to various aspects
      of
      our businesses. Other industry participants are also defendants in certain
      of
      these cases, and, in many cases, we expect that any potential liability would
      be
      the responsibility of our equipment vendors pursuant to applicable contractual
      indemnification provisions. In the event that a court ultimately determines
      that
      we infringe on any intellectual property rights, we may be subject to
      substantial damages and/or an injunction that could require us or our vendors
      to
      modify certain products and services we offer to our subscribers. While we
      believe the lawsuits are without merit and intend to defend the actions
      vigorously, the lawsuits could be material to our consolidated results of
      operations of any one period, and no assurance can be given that any adverse
      outcome would not be material to our consolidated financial condition, results
      of operations or liquidity.





We
      and
      our parent companies are party to other lawsuits and claims that arise in the
      ordinary course of conducting our business. The ultimate outcome of these other
      legal matters pending against us or our subsidiaries cannot be predicted, and
      although such lawsuits and claims are not expected individually to have a
      material adverse effect on our consolidated financial condition, results of
      operations or liquidity, such lawsuits could have, in the aggregate, a material
      adverse effect on our consolidated financial condition, results of operations
      or
      liquidity.





**Item
      1A.**  **Risk
      Factors.**





Our
      Annual Report on Form 10-K for the year ended December 31, 2006 includes “Risk
      Factors” under Item 1A of Part I. Except for the updated risk factors described
      below, there have been no material changes from the risk factors described
      in
      our Form 10-K. The information below updates, and should be read in conjunction
      with, the risk factors and information disclosed in our Form 10-K.





**Risks
      Related to Significant Indebtedness of Us and Our Parent
      Companies**





***We
      and our parent companies have a significant amount of existing debt and may
      incur significant additional debt, including secured debt, in the future, which
      could adversely affect our and our parent companies’ financial health and our
      and their ability to react to changes in our
      business.***





We
      and
      our parent companies have a significant amount of debt and may (subject to
      applicable restrictions in their debt instruments) incur additional debt in
      the
      future. As of March 31, 2007, our total debt was approximately $8.8 billion,
      our
      member’s equity was approximately $3.5 billion and the deficiency of earnings to
      cover fixed charges for the three months ended March 31, 2007 was $36 million.





As
      of
      March 31, 2007, our parent companies had approximately $10.3 billion aggregate
      principal amount of debt. We and our parent companies will need to raise
      additional capital and/or receive distributions or payments from subsidiaries
      in
      order to satisfy our and their respective debt obligations. An additional $450
      million aggregate principal amount of Charter’s convertible notes was held by
      CCHC.





Because
      of our and their significant indebtedness, our and our parent companies’ ability
      to raise additional capital at reasonable rates or at all is uncertain, and
      our
      and our parent companies’ ability to make distributions or payments to our and
      their respective parent companies is subject to availability of funds and
      restrictions under our and our subsidiary’s applicable debt instruments and
      under applicable law. If we find it necessary to engage in a recapitalization
      or
      other similar transaction, our noteholders might not receive principal and
      interest payments to which they are contractually entitled.





Our
      and
      our parent companies’ significant amount of debt could have other important
      consequences. For example, the debt will or could:




·
              require
                  us to dedicate a significant portion of our cash flow from operating
                  activities to make payments on our and our parent companies’ debt, which
                  will reduce our funds available for working capital, capital expenditures
                  and other general corporate
                  expenses;
 ·
              limit
                  our flexibility in planning for, or reacting to, changes in our
                  business,
                  the cable and telecommunications industries and the economy at
                  large;




27






·
            place
                us at a disadvantage as compared to our competitors that have
                proportionately less debt;


·
            make
                us vulnerable to interest rate increases, because approximately 34%
                of our
                borrowings are, and will continue to be, at variable rates of
                interest;


·
            expose
                us to increased interest expense as we refinance existing lower interest
                rate instruments;


·
            adversely
                affect our relationship with customers and
                suppliers;


·
            limit
                our and our parent companies’ ability to borrow additional funds in the
                future, due to applicable financial and restrictive covenants in
                our
                debt;


·
            make
                it more difficult for us to satisfy our obligations to the holders
                of our
                notes and to the lenders under our credit facilities as well as our
                parent
                companies’ ability to satisfy their obligations to their noteholders;
                and


·
            limit
                future increases in the value, or cause a decline in the value of
                Charter’s equity, which could limit Charter’s ability to raise additional
                capital by issuing equity.





A
      default
      by us or one of our parent companies under our and their debt obligations could
      result in the acceleration of those obligations, which in turn could trigger
      cross defaults under other agreements governing our and our parent companies’
long-term indebtedness. In addition, the secured lenders under our credit
      facilities and the holders of the Charter Operating senior second-lien notes
      could foreclose on their collateral, which includes equity interest in our
      subsidiaries, and exercise other rights of secured creditors. Any default under
      those credit facilities or the indentures governing Charter’s convertible notes
      or our and our parent companies’ debt could adversely affect our growth, our
      financial condition, our results of operations, Charter’s ability to make
      payments on Charter’s convertible notes, our credit facilities, and could force
      us to seek the protection of the bankruptcy laws. We and our parent companies
      may incur significant additional debt in the future. If current debt levels
      increase, the related risks that we now face will intensify.





***We
      may not be able to access funds under the Charter Operating credit facilities
      if
      we fail to satisfy the covenant restrictions in such credit facilities, which
      could adversely affect our financial condition and our ability to conduct our
      business.***





We
      have
      historically relied on access to credit facilities in order to fund operations
      and to service parent company debt, and we expect such reliance to continue
      in
      the future. Our total potential borrowing availability under our revolving
      credit facility was approximately $1.4 billion as of March 31, 2007, none of
      which is limited by covenant restrictions. There
      can
      be no assurance that our actual availability under our credit facilities will
      not be limited by covenant restrictions in the future.





One
      of
      the conditions to the availability of funding under our credit facilities is
      the
      absence of a default under such facilities, including as a result of any failure
      to comply with the covenants under the facilities. Among other covenants, the
      Charter Operating credit facilities require us to maintain specific leverage
      ratios. The Charter Operating credit facilities also provide that Charter
      Operating has to obtain an unqualified audit opinion from its independent
      accountants for each fiscal year. There can be no assurance that Charter
      Operating will be able to continue to comply with these or any other of the
      covenants under the credit facilities.





An
      event
      of default under the credit facilities or indentures, if not waived, could
      result in the acceleration of those debt obligations and, consequently, could
      trigger cross defaults under other agreements governing our and our parent
      companies’ long-term indebtedness. In addition, the secured lenders under the
      Charter Operating credit facilities and the holders of the Charter Operating
      senior second-lien notes could foreclose on their collateral, which includes
      equity interest in our subsidiaries, and exercise other rights of secured
      creditors. Any default under those credit facilities or the indentures governing
      our or our parent companies’ debt could adversely affect our growth, our
      financial condition, our results of operations, and our ability to make payments
      on our convertible notes, our credit facilities, and could force us to seek
      the
      protection of the bankruptcy laws, which could materially adversely impact
      our
      ability to operate our business and to make payments under our debt
      instruments.





***We
      depend on generating sufficient cash flow and having access to additional
      external liquidity sources to fund our and our parent companies’ debt
      obligations, capital expenditures, and ongoing
      operations.***





Our
      ability to service our and our parent companies’ debt and to fund our planned
      capital expenditures and ongoing operations will depend on both our and our
      parent companies’ ability to generate cash flow and our and our parent
      companies’ access to additional external liquidity sources. Our and our parent
      companies’ ability to generate cash flow is dependent on many factors,
      including:




28





·
            competition
                from other distributors, including incumbent telephone companies,
                direct
                broadcast satellite operators, wireless broadband providers and DSL
                providers;


·
            unforeseen
                difficulties we may encounter in our continued introduction of our
                telephone services such as our ability to meet heightened customer
                expectations for the reliability of voice services compared to other
                services we provide, and our ability to meet heightened demand for
                installations and customer service;


·
            our
                ability to sustain and grow revenues by offering video, high-speed
                Internet, telephone and other services, and to maintain and grow
                a stable
                customer base, particularly in the face of increasingly aggressive
                competition from other service
                providers;


·
            our
                ability to obtain programming at reasonable prices or to pass programming
                cost increases on to our customers;


·
            general
                business conditions, economic uncertainty or slowdown;
                and


·
            the
                effects of governmental regulation, including but not limited to
                local
                franchise authorities, on our
                business.





Some
      of
      these factors are beyond our control. If we and our parent companies are unable
      to generate sufficient cash flow or access additional external liquidity
      sources, we and our parent companies may not be able to service and repay our
      and our parent companies’ debt, operate our business, respond to competitive
      challenges, or fund our and our parent companies’ other liquidity and capital
      needs. Although we and our parent companies have been able to raise funds
      through issuances of debt in the past, we may not be able to access additional
      sources of external liquidity on similar terms, if at all. We expect that cash
      on hand, cash flows from operating activities, and the amounts available under
      our credit facilities will be adequate to meet our and our parent companies’
cash needs through 2008. We believe that cash flows from operating activities
      and amounts available under our credit facilities may not be sufficient to
      fund
      our operations and satisfy our and our parent companies’ interest and principal
      repayment obligations in 2009 and will not be sufficient to fund such needs
      in
      2010 and beyond. See “Part I. Item 2. Management's Discussion and Analysis of
      Financial Condition and Results of Operations — Liquidity and Capital Resources.”





***Because
      of our holding company structure, our outstanding notes are structurally
      subordinated in right of payment to all liabilities of our subsidiaries.
      Restrictions in our subsidiary’s debt instruments and under applicable law limit
      their ability to provide funds to us or our various parent companies who are
      debt issuers.***





Our
      primary assets are our equity interests in our subsidiaries. Our operating
      subsidiaries are separate and distinct legal entities and are not obligated
      to
      make funds available to us for payments on our notes or other obligations in
      the
      form of loans, distributions or otherwise. Our subsidiary’s ability to make
      distributions to us is subject to their compliance with the terms of their
      credit facilities and indentures and restrictions under applicable law. Under
      the Delaware limited liability company act, our subsidiaries may only make
      distributions to us if they have “surplus” as defined in the act. Under
      fraudulent transfer laws, our subsidiaries may not make distributions to us
      or
      the applicable debt issuers to service debt obligations if they are insolvent
      or
      are rendered insolvent thereby. The measures of insolvency for purposes of
      these
      fraudulent transfer laws vary depending upon the law applied in any proceeding
      to determine whether a fraudulent transfer has occurred. Generally, however,
      an
      entity would be considered insolvent if:





·
            the
                sum of its debts, including contingent liabilities, was greater than
                the
                fair saleable value of all its
                assets;


·
            the
                present fair saleable value of its assets was less than the amount
                that
                would be required to pay its probable liability on its existing debts,
                including contingent liabilities, as they became absolute and mature;
                or


·
            it
                could not pay its debts as they became
                due.





While
      we
      believe that our relevant subsidiaries currently have surplus and are not
      insolvent, there can be no assurance that these subsidiaries will be permitted
      to make distributions in the future in compliance with these restrictions in
      amounts needed to service our indebtedness. Our direct or indirect subsidiaries
      include the borrowers and guarantors under the Charter Operating credit
      facilities. Charter Operating is also an obligor under the second-lien notes.
      As
      of March 31, 2007, our total debt was approximately $8.8 billion, of which
      approximately $7.5 billion was structurally senior to the CCO Holdings notes.




29




In
      the
      event of bankruptcy, liquidation or dissolution of one or more of our
      subsidiaries, that subsidiary’s assets would first be applied to satisfy its own
      obligations, and following such payments, such subsidiary may not have
      sufficient assets remaining to make payments to us as an equity holder or
      otherwise. In that event:





·
            the
                lenders under Charter Operating’s credit facilities whose interests are
                secured by substantially all of our operating assets, will have the
                right
                to be paid in full before us from any of our subsidiaries’ assets;
                and


·
            the
                holders of preferred membership interests in our subsidiary, CC VIII,
                would have a claim on a portion of its assets that may reduce the
                amounts
                available for repayment to holders of our outstanding notes.





**Risks
      Related to Regulatory and Legislative Matters**





***Our
      cable system franchises are non-exclusive. Accordingly, local franchising
      authorities can grant additional franchises and create competition in market
      areas where none existed previously, resulting in overbuilds, which could
      adversely affect results of operations.***





Our
      cable
      system franchises are non-exclusive. Consequently, local franchising authorities
      can grant additional franchises to competitors in the same geographic area
      or
      operate their own cable systems. In addition, certain telephone companies are
      seeking authority to operate in local communities without first obtaining a
      local franchise. As a result, competing operators may build systems in areas
      in
      which we hold franchises. In some cases municipal utilities may legally compete
      with us without obtaining a franchise from the local franchising
      authority.





Legislative
      proposals have been introduced in the United States Congress and in state
      legislatures that would greatly streamline cable franchising. This legislation
      is intended to facilitate entry by new competitors, particularly local telephone
      companies. Such legislation has passed in numerous states, including states
      where we have significant operations. Although most of these states have
      provided some regulatory relief for incumbent cable operators, some of these
      proposals are generally viewed as being more favorable to new entrants due
      to a
      number of factors, including efforts to withhold streamlined cable franchising
      from incumbents until after the expiration of their existing franchises, and
      the
      potential for new entrants to serve only higher-income areas of a particular
      community. To the extent incumbent cable operators are not able to avail
      themselves of this streamlined franchising process, such operators may continue
      to be subject to more onerous franchise requirements at the local level than
      new
      entrants. In March 2007, the FCC released a ruling designed to streamline
      competitive cable franchising. Among other things, the FCC prohibited local
      franchising authorities from imposing “unreasonable” build-out requirements and
      established a mechanism whereby competing providers can secure “interim
      authority” to offer cable service if the local franchising authority has not
      acted on a franchise application within 90 days (in the case of competitors
      with
      existing right of way authority) or 180 days (in the case of competitors without
      existing right of way authority). Local regulators have appealed the FCC’s
      ruling.





The
      existence of more than one cable system operating in the same territory is
      referred to as an overbuild. These overbuilds could adversely affect our growth,
      financial condition and results of operations by creating or increasing
      competition. As of March 31, 2007, we are aware of traditional overbuild
      situations impacting approximately 9% of our estimated homes passed, and
      potential traditional overbuild situations in areas servicing approximately
      an
      additional 4% of our estimated homes passed. Additional overbuild situations
      may
      occur in other systems.





***We
      may be required to provide access to our networks to other Internet service
      providers which could significantly increase our competition and adversely
      affect our ability to provide new products and
      services.***





A
      number
      of companies, including independent Internet service providers, or ISPs, have
      requested local authorities and the FCC to require cable operators to provide
      non-discriminatory access to cable’s broadband infrastructure, so that these
      companies may deliver Internet services directly to customers over cable
      facilities. In a 2005 ruling, commonly referred to as *Brand
      X* ,
      the
      Supreme Court upheld an FCC decision making it less likely that any
      nondiscriminatory “open access” requirements (which are generally associated
      with common carrier regulation of “telecommunications services”) will be imposed
      on the cable industry by local, state or federal authorities. The Supreme Court
      held that the FCC was correct in classifying cable provided Internet service
      as
      an “information service,” rather than a “telecommunications service.”
Notwithstanding *Brand
      X* ,
      there
      has been increasing advocacy by certain Internet content providers and consumer
      groups for new federal laws or regulations to adopt so-called “net neutrality”
principles limiting the ability of broadband network owners (like us) to manage
      and control their own networks. The proposals might prevent network owners,
      for
      example, from charging bandwidth intensive content providers, such as certain
      online gaming, music, and video service providers, an additional fee to ensure




30




quality
      delivery of the services to consumers. If we were required to allocate a portion
      of our bandwidth capacity to other Internet service providers, or were
      prohibited from charging heavy bandwidth intensive services a fee for use of
      our
      networks, we believe that it could impair our ability to use our bandwidth
      in
      ways that would generate maximum revenues. In April 2007, the FCC issued a
      notice of inquiry regarding the marketing practices of broadband providers
      as a
      precursor to considering the need for any FCC regulation of internet service
      providers.





***Changes
      in channel carriage regulations could impose significant additional costs on
      us.***





Cable
      operators also face significant regulation of their channel carriage. They
      currently can be required to devote substantial capacity to the carriage of
      programming that they might not carry voluntarily, including certain local
      broadcast signals, local public, educational and government access programming,
      and unaffiliated commercial leased access programming. This carriage burden
      could increase in the future, particularly if cable systems were required to
      carry both the analog and digital versions of local broadcast signals (dual
      carriage) or to carry multiple program streams included with a single digital
      broadcast transmission (multicast carriage). Additional government-mandated
      broadcast carriage obligations could disrupt existing programming commitments,
      interfere with our preferred use of limited channel capacity and limit our
      ability to offer services that would maximize customer appeal and revenue
      potential. Although the FCC issued a decision in February 2005, confirming
      an
      earlier ruling against mandating either dual carriage or multicast carriage,
      that decision is subject to a petition for reconsideration which is pending.
      In
      addition, the FCC could reverse its own ruling or Congress could legislate
      additional carriage obligations. The FCC is in the process of initiating a
      new
      rulemaking to explore the cable industry’s carriage obligations once the
      broadcast industry transition from analog to digital transmission is completed
      in February 2009. It is possible that the FCC will rule in favor of dual
      carriage and/or multicast carriage in certain circumstances.





**Item
      6.****Exhibits.**





The
      index
      to the exhibits begins on page E-1 of this quarterly report.







31


**SIGNATURES**





Pursuant
      to the requirements of the Securities Exchange Act of 1934, as amended, CCO
      Holdings, LLC and CCO Holdings Capital Corp. have duly caused this quarterly
      report to be signed on its behalf by the undersigned, thereunto duly authorized.





CCO
      HOLDINGS, LLC


Registrant


By:
      CHARTER COMMUNICATIONS INC., Sole Manager





Dated:
                May 15, 2007
            By:/s/
                Kevin D.
                HowardName:
            Kevin
                D. HowardTitle:
            *Vice
                President and**Chief
                Accounting Officer*





CCO
      HOLDINGS CAPITAL CORP.


Registrant





Dated:
                May 15, 2007
            By:/s/
                Kevin D.
                HowardName:
            Kevin
                D. HowardTitle:
            *Vice
                President and**Chief
                Accounting Officer*











S-1





**EXHIBIT
      INDEX**





Exhibit
              Number
            
            Description
                of Document3.1(a)
            
            Certificate
                of Formation of CCO Holdings, LLC (incorporated by reference to
                Exhibit 3.1 to the registration statement on Form S-4 of CCO
                Holdings, LLC and CCO Holdings Capital Corporation filed on February
                6,
                2004 (File No. 333-112593)).3.1(b)
            
            Certificate
                of Correction of Certificate of Formation of CCO Holdings, LLC
                (incorporated by reference to Exhibit 3.2 to the registration
                statement on Form S-4 of CCO Holdings, LLC and CCO Holdings Capital
                Corporation filed on February 6, 2004 (File No.
                333-112593)).3.2
            
            Amended
                and Restated Limited Liability Company Agreement of CCO Holdings,
                LLC,
                dated as of June 19, 2003 (incorporated by reference to Exhibit 3.3
                to the registration statement on Form S-4 of CCO Holdings, LLC and
                CCO Holdings Capital Corporation filed on February 6, 2004 (File
                No.
                333-112593)).3.3(a)
            
            Certificate
                of Incorporation of CCO Holdings Capital Corp. (originally named
                CC Holdco
                I Capital Corp.) (incorporated by reference to Exhibit 3.4 to the
                registration statement on Form S-4 of CCO Holdings, LLC and CCO
                Holdings Capital Corporation filed on February 6, 2004 (File No.
                333-112593)).3.3(b)
            
            Certificate
                of Amendment of Certificate of Incorporation of CCO Holdings Capital
                Corp.
                (incorporated by reference to Exhibit 3.5 to the registration
                statement on Form S-4 of CCO Holdings, LLC and CCO Holdings Capital
                Corporation filed on February 6, 2004 (File No.
                333-112593)).3.4
            
            By-laws
                of CCO Holdings Capital Corp. (incorporated by reference to
                Exhibit 3.6 to the registration statement on Form S-4 of CCO
                Holdings, LLC and CCO Holdings Capital Corporation filed on February
                6,
                2004 (File No. 333-112593)).4.1
            
            Amended
                and Restated Credit Agreement, dated as of March 6, 2007, among Charter
                Communications Operating, LLC, CCO Holdings, LLC, the lenders from
                time to time parties thereto and JPMorgan Chase Bank, N.A., as
                administrative agent (incorporated by reference to Exhibit 10.1 to
                the
                current report on Form 8-K of Charter Communications, Inc. filed
                on March
                9, 2007 (File No. 000-27927)).4.2
            
            Amended
                and Restated Guarantee and Collateral Agreement made by CCO Holdings,
                LLC,
                Charter Communications Operating, LLC and certain of its subsidiaries
                in
                favor of JPMorgan Chase Bank, N.A. ,as administrative agent, dated
                as of
                March 18, 1999, as amended and restated as of March 6,
                2007 (incorporated by reference to Exhibit 10.2 to the current report
                on Form 8-K of Charter Communications, Inc. filed on March 9, 2007
                (File
                No. 000-27927)).4.3
            
            Credit
                Agreement, dated as of March 6, 2007, among CCO Holdings, LLC, the
                lenders
                from time to time parties thereto and Bank of America, N.A., as
                administrative agent (incorporated by reference to Exhibit 10.3 to
                the
                current report on Form 8-K of Charter Communications, Inc. filed
                on March
                9, 2007 (File No. 000-27927)).4.4
            
            Pledge
                Agreement made by CCO Holdings, LLC in favor of Bank of America,
                N.A., as
                Collateral Agent, dated as of March 6, 2007 (incorporated by reference
                to
                Exhibit 10.4 to the current report on Form 8-K of Charter Communications,
                Inc. filed on March 9, 2007 (File No. 000-27927)).10.1+
            
            Separation
                Agreement and Release for Sue Ann R. Hamilton (incorporated by reference
                to Exhibit 99.1 to the current report on Form 8-K of Charter
                Communications, Inc. filed on March 14, 2007 (File No. 000-27927)).12.1*
            
            Computation
                of Ratio of Earnings to Fixed Charges31.1*
            
            Certificate
                of Chief Executive Officer pursuant to Rule 13a-14(a)/Rule 15d-14(a)
                under
                the Securities Exchange Act of 1934.31.2*
            
            Certificate
                of Chief Financial Officer pursuant to Rule 13a-14(a)/Rule 15d-14(a)
                under
                the Securities Exchange Act of 1934.32.1*
            
            Certification
                pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
                906 of
                the Sarbanes-Oxley Act of 2002 (Chief Executive
                Officer).32.2*
            
            Certification
                pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
                906 of
                the Sarbanes-Oxley Act of 2002 (Chief Financial
                Officer).





*
      Document attached


+
      Management compensatory plan or arrangement





E-1