----

|   |   |   |   |   |
|--------|--------|--------|--------|--------|

|   | x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE |
|--------|-----------------------------------------------------------|

|   | SECURITIES EXCHANGE ACT OF 1934 |
|--------|---------------------------------|

|   | o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE |
|--------|------------------------------------------------------------|

|   | SECURITIES EXCHANGE ACT OF 1934 |
|--------|---------------------------------|

|   | GCI, INC.                                              |   |
|--------|--------------------------------------------------------|--------|
|   | (Exact name of registrant as specified in its charter) |   |

|   | State of Alaska                 |   | 91-1820757          |   |
|--------|---------------------------------|--------|---------------------|--------|
|   | (State or other jurisdiction of |   | (I.R.S Employer     |   |
|   | incorporation or organization)  |   | Identification No.) |   |

|   | 2550 Denali Street                      |   |       |   |
|--------|-----------------------------------------|--------|------------|--------|
|   | Suite 1000                              |   |       |   |
|   | Anchorage, Alaska                       |   | 99503      |   |
|   | (Address of principalexecutive offices) |   | (Zip Code) |   |

|   | Registrant’s telephone number, including area code: (907) 868-5600 |
|--------|--------------------------------------------------------------------------|

|   | Not Applicable                                                                         |   |
|--------|----------------------------------------------------------------------------------------|--------|
|   | Former name, former address and former fiscal year, if changed since last report  |   |

| Large accelerated filer o                                             | Accelerated filer o         |
|-----------------------------------------------------------------------|-----------------------------|
| Non-accelerated filer x (Do not check if a smaller reporting company) | Smaller reporting company o |

----

|                                                      |                                                 |                                                              |      |   | Page No.  |
|-----------------------------------------------------------|------------------------------------------------------|-------------------------------------------------------------------|-----------|--------|-----------|
|                                                      |                                                 |                                                              |      |   |      |
| Cautionary Statement Regarding Forward-Looking Statements |   3                                             |
|                                                      |                                                 |                                                              |      |   |      |
| Part I.  FINANCIAL INFORMATION                  |                                                 |
|                                                      |                                                 |                                                              |      |   |      |
|                                                      | Item I.                                              | Financial Statements                                              |      |   |   4  |
|                                                      |                                                 |                                                              |      |   |      |
|                                                      |                                                 | Consolidated Balance Sheets (unaudited) as of March 31, 2010 and  |      |   |      |
|                                                      |                                                 |   December 31, 2009                                     |      |   |   4  |
|                                                      |                                                 |                                                              |      |   |      |
|                                                      |                                                 | Consolidated Income Statements for the three months ended         |      |   |      |
|                                                      |                                                 |   March 31, 2010 (unaudited) and 2009 (unaudited)       |      |   |   6  |
|                                                      |                                                 |                                                              |      |   |      |
|                                                      |                                                 | Consolidated Statements of Cash Flows for the three months        |      |   |   7  |
|                                                      |                                                 |   ended March 31, 2010 (unaudited) and 2009 (unaudited) |      |   |      |
|                                                      |                                                 |                                                              |      |   |      |
|                                                      |                                                 | Notes to Interim Consolidated Financial Statements (unaudited)    |      |   |   8  |
|                                                      |                                                 |                                                              |      |   |      |
|                                                      | Item 2.                                              | Management’s Discussion and Analysis of Financial Condition |      |   |      |
|                                                      |                                                 |   and Results of Operations                             |      |   |   20 |
|                                                      |                                                 |                                                              |      |   |      |
|                                                      | Item 3.                                              | Quantitative and Qualitative Disclosures About Market Risk        |      |   |   31 |
|                                                      |                                                 |                                                              |      |   |      |
|                                                      | Item 4.                                              | Controls and Procedures                                           |      |   |   31 |
|                                                      |                                                 |                                                              |      |   |      |
| Part II.  OTHER INFORMATION                     |                                                 |                                                              |      |
|                                                      |                                                 |                                                              |      |   |      |
|                                                      | Item 1.                                              | Legal Proceedings                                                 |      |   |   32 |
|                                                      |                                                 |                                                              |      |   |      |
|                                                      | Item 6.                                              | Exhibits                                                          |      |   |   32 |
|                                                      |                                                 |                                                              |      |   |      |
|                                                      | Other items are omitted, as they are not applicable. |                                                              |      |
|                                                      |                                                 |                                                              |      |   |      |
| SIGNATURES                                                |                                                 |                                                              |   33 |

----

----

| (Amounts in thousands)                                    |   | (Unaudited) |      |   |         |   |
|-----------------------------------------------------------|--------|-------------|-----------|--------|--------------|--------|
|                                                      |   | March 31,   |      |   | December 31, |   |
| ASSETS                                                    |   | 2010        |      |   | 2009         |   |
|                                                      |   |        |      |   |         |   |
| Current assets:                                           |   |        |      |   |         |   |
| Cash and cash equivalents                                 |   | $           | 67,853    |   |         |   | 48,142 |   |
|                                                      |   |        |      |   |         |   |   |   |
| Receivables                                               |   |        | 136,392   |   |         |   | 147,859 |   |
| Less allowance for doubtful receivables                   |   |        | 8,023     |   |         |   | 7,060 |   |
| Net receivables                                           |   |        | 128,369   |   |         |   | 140,799 |   |
|                                                      |   |        |      |   |         |   |   |   |
| Deferred income taxes                                     |   |        | 17,618    |   |         |   | 17,618 |   |
| Prepaid expenses                                          |   |        | 7,217     |   |         |   | 4,491 |   |
| Inventories                                               |   |        | 7,047     |   |         |   | 9,278 |   |
| Investment securities                                     |   |        | 905       |   |         |   | 895 |   |
|  Other current assets                                |   |        | 4,676     |   |         |   | 4,977 |   |
| Total current assets                                      |   |        | 233,685   |   |         |   | 226,200 |   |
|                                                      |   |        |      |   |         |   |   |   |
| Property and equipment in service, net of depreciation    |   |        | 812,132   |   |         |   | 823,080 |   |
| Construction in progress                                  |   |        | 24,212    |   |         |   | 26,161 |   |
| Net property and equipment                                |   |        | 836,344   |   |         |   | 849,241 |   |
|                                                      |   |        |      |   |         |   |   |   |
| Cable certificates                                        |   |        | 191,565   |   |         |   | 191,565 |   |
| Goodwill                                                  |   |        | 73,452    |   |         |   | 73,452 |   |
| Wireless licenses                                         |   |        | 25,967    |   |         |   | 25,967 |   |
| Other intangible assets, net of amortization              |   |        | 18,371    |   |         |   | 19,561 |   |
| Deferred loan and senior notes costs, net of amortization |   |        | 14,802    |   |         |   | 13,168 |   |
| Other assets                                              |   |        | 18,980    |   |         |   | 18,609 |   |
| Total other assets                                        |   |        | 343,137   |   |         |   | 342,322 |   |
| Total assets                                              |   | $           | 1,413,166 |   |         |   | 1,417,763 |   |

----

| (Amounts in thousands)                                                                                                         |   |   | (Unaudited) |      |   |         |   |
|--------------------------------------------------------------------------------------------------------------------------------|--------|--------|-------------|-----------|--------|--------------|--------|
|                                                                                                                           |   |   | March 31,   |      |   | December 31, |   |
| LIABILITIES AND STOCKHOLDER’S EQUITY                                                                                     |   |   | 2010        |      |   | 2009         |   |
|                                                                                                                           |   |   |        |      |   |         |   |
| Current liabilities:                                                                                                           |   |   |        |      |   |         |   |
| Current maturities of obligations under long-term debt and capital leases                                                      |   |   | $           | 10,264    |   |         |   | 9,892 |   |
| Accounts payable                                                                                                               |   |   |        | 26,881    |   |         |   | 30,697 |   |
| Deferred revenue                                                                                                               |   |   |        | 21,627    |   |         |   | 21,404 |   |
| Accrued interest                                                                                                               |   |   |        | 18,084    |   |         |   | 14,821 |   |
| Accrued payroll and payroll related obligations                                                                                |   |   |        | 17,256    |   |         |   | 21,874 |   |
| Accrued liabilities                                                                                                            |   |   |        | 11,629    |   |         |   | 15,037 |   |
| Subscriber deposits                                                                                                            |   |   |        | 1,415     |   |         |   | 1,549 |   |
| Total current liabilities                                                                                                      |   |   |        | 107,156   |   |         |   | 115,274 |   |
|                                                                                                                           |   |   |        |      |   |         |   |   |   |
| Long-term debt, net                                                                                                            |   |   |        | 774,363   |   |         |   | 771,247 |   |
| Obligations under capital leases, excluding current maturities                                                                 |   |   |        | 88,020    |   |         |   | 89,279 |   |
| Obligation under capital lease due to related party                                                                            |   |   |        | 1,878     |   |         |   | 1,876 |   |
| Deferred income taxes                                                                                                          |   |   |        | 100,221   |   |         |   | 100,386 |   |
| Long-term deferred revenue                                                                                                     |   |   |        | 51,824    |   |         |   | 52,342 |   |
| Other liabilities                                                                                                              |   |   |        | 21,607    |   |         |   | 21,676 |   |
| Total liabilities                                                                                                              |   |   |        | 1,145,069 |   |         |   | 1,152,080 |   |
|                                                                                                                           |   |   |        |      |   |         |   |   |   |
| Commitments and contingencies                                                                                                  |   |   |        |      |   |         |   |   |   |
| Stockholder’s equity:                                                                                                    |   |   |        |      |   |         |   |   |   |
| Class A common stock (no par). Authorized 10 shares; issued and outstanding 0.1 shares at March 31, 2010 and December 31, 2009 |   |   |        | 206,622   |   |         |   | 206,622 |   |
| Paid-in capital                                                                                                                |   |   |        | 50,231    |   |         |   | 49,165 |   |
| Retained earnings                                                                                                              |   |   |        | 11,244    |   |         |   | 9,896 |   |
| Total stockholder’s equity                                                                                               |   |   |        | 268,097   |   |         |   | 265,683 |   |
| Total liabilities and stockholder’s equity                                                                               |   |   | $           | 1,413,166 |   |         |   | 1,417,763 |   |

|   | See accompanying notes to interim consolidated financial statements. |
|--------|----------------------------------------------------------------------|

----

|                                                                                   |   | Three Months Ended |    |
|----------------------------------------------------------------------------------------|--------|--------------------|---------|
|                                                                                   |   | March 31,          |    |
| (Amounts in thousands)                                                                 |   | 2010               |    |   | 2009 |   |
| Revenues                                                                               |   | $                  | 152,419 |   |   |   | 148,689 |   |
|                                                                                   |   |               |    |   |   |   |   |   |
| Cost of goods sold (exclusive of depreciation and amortization shown separately below) |   |               | 48,907  |   |   |   | 47,857 |   |
| Selling, general and administrative expenses                                           |   |               | 53,257  |   |   |   | 56,586 |   |
| Depreciation and amortization expense                                                  |   |               | 31,126  |   |   |   | 30,734 |   |
| Operating income                                                                       |   |               | 19,129  |   |   |   | 13,512 |   |
|                                                                                   |   |               |    |   |   |   |   |   |
| Other income (expense):                                                                |   |               |    |   |   |   |   |   |
| Interest expense (including amortization of deferred loan   fees)       |   |               | (17,680 | ) |   |   | (12,647 | ) |
| Interest income                                                                        |   |               | 61      |   |   |   | 8 |   |
| Other expense, net                                                                     |   |               | (17,619 | ) |   |   | (12,639 | ) |
|                                                                                   |   |               |    |   |   |   |   |   |
| Income before income tax expense or benefit                                            |   |               | 1,510   |   |   |   | 873 |   |
|                                                                                   |   |               |    |   |   |   |   |   |
| Income tax (expense) benefit                                                           |   |               | 164     |   |   |   | (519 | ) |
|                                                                                   |   |               |    |   |   |   |   |   |
| Net income                                                                             |   | $                  | 1,674   |   |   |   | 354 |   |

----

| (Amounts in thousands)                                                                       |   | 2010   |    |   | 2009   |   |
|----------------------------------------------------------------------------------------------|--------|--------|---------|--------|--------|--------|
| Cash flows from operating activities:                                                        |   |   |    |   |   |   |
| Net income                                                                                   |   | $      | 1,674   |   |   |   | 354 |   |
| Adjustments to reconcile net income to net cash provided  by operating activities: |   |   |    |   |   |   |   |   |
| Depreciation and amortization expense                                                        |   |   | 31,126  |   |   |   | 30,734 |   |
| Share-based compensation expense                                                             |   |   | 803     |   |   |   | 1,802 |   |
| Deferred income tax expense (benefit)                                                        |   |   | (164    | )      |   |   | 519 |   |
| Other noncash income and expense items                                                       |   |   | 1,675   |   |   |   | 2,108 |   |
| Change in operating assets and liabilities                                                   |   |   | 4,025   |   |   |   | (3,515 | ) |
| Net cash provided by operating activities                                                    |   |   | 39,139  |   |   |   | 32,002 |   |
|                                                                                         |   |   |    |   |   |   |   |   |
| Cash flows from investing activities:                                                        |   |   |    |   |   |   |   |   |
| Purchases of property and equipment                                                          |   |   | (18,480 | )      |   |   | (32,546 | ) |
| Purchases of other assets and intangible assets                                              |   |   | (784    | )      |   |   | (448 | ) |
| Net cash used in investing activities                                                        |   |   | (19,264 | )      |   |   | (32,994 | ) |
|                                                                                         |   |   |    |   |   |   |   |   |
| Cash flows from financing activities:                                                        |   |   |    |   |   |   |   |   |
| Issuance of long-term debt                                                                   |   |   | 4,532   |   |   |   | --- |   |
| Repayment of debt and capital lease obligations                                              |   |   | (2,393  | )      |   |   | (3,168 | ) |
| Payment of debt issuance costs                                                               |   |   | (1,981  | )      |   |   | --- |   |
| Distribution to General Communication, Inc.                                                  |   |   | (322    | )      |   |   | (234 | ) |
| Net cash used in financing activities                                                        |   |   | (164    | )      |   |   | (3,402 | ) |
| Net increase (decrease) in cash and cash equivalents                                         |   |   | 19,711  |   |   |   | (4,394 | ) |
| Cash and cash equivalents at beginning of period                                             |   |   | 48,142  |   |   |   | 29,693 |   |
|                                                                                         |   |   |    |   |   |   |   |   |
| Cash and cash equivalents at end of period                                                   |   | $      | 67,853  |   |   |   | 25,299 |   |

----

|   | (a) | Business |
|--------|-----|----------|

|   | · | Origination and termination of traffic in Alaska for certain common carriers, |
|--------|--------|-------------------------------------------------------------------------------|

|   | · | Cable television services throughout Alaska, |
|--------|--------|----------------------------------------------|

|   | · | Competitive local access services throughout Alaska, |
|--------|--------|------------------------------------------------------|

|   | · | Incumbent local access services in rural Alaska, |
|--------|--------|--------------------------------------------------|

|   | · | Long-distance telephone service, |
|--------|--------|----------------------------------|

|   | · | Sale of postpaid and prepaid wireless telephone services and sale of wireless telephone handsets and accessories, |
|--------|--------|-------------------------------------------------------------------------------------------------------------------|

|   | · | Data network services, |
|--------|--------|------------------------|

|   | · | Internet access services, |
|--------|--------|---------------------------|

|   | · | Wireless roaming for certain wireless carriers, |
|--------|--------|-------------------------------------------------|

|   | · | Broadband services, including our SchoolAccess® offering to rural school districts, our ConnectMD® offering to rural hospitals and health clinics, and managed video conferencing, |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Managed services to certain commercial customers, |
|--------|--------|---------------------------------------------------|

|   | · | Sales and service of dedicated communications systems and related equipment, |
|--------|--------|------------------------------------------------------------------------------|

|   | · | Lease, service arrangements and maintenance of capacity on our fiber optic cable systems used in the transmission of interstate and intrastate data, switched message long-distance and Internet services within Alaska and between Alaska and the remaining United States and foreign countries, and |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Distribution of white and yellow pages directories to residential and business customers in certain markets we serve and on-line directory products. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |  (b) | Principles of Consolidation |
|--------|-----------|-----------------------------|

|   | The consolidated financial statements include the consolidated accounts of GCI, Inc. and its wholly-owned subsidiaries.   All significant intercompany transactions between non-regulated affiliates of our company are eliminated.   Intercompany transactions generated between regulated and non-regulated affiliates of the company are not eliminated in consolidation. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | (d)   | Recently Adopted Accounting Pronouncements |
|--------|-----------------|--------------------------------------------|

| ·   | For purposes of reporting fair value measurement for each class of assets and liabilities, a reporting entity needs to use judgment in determining the appropriate classes of assets and liabilities; and |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | A reporting entity should provide disclosures about the valuation techniques and inputs used to measure fair value for both recurring and nonrecurring fair value measurements. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (e) | Regulatory Accounting and Regulation |
|--------|-----|--------------------------------------|

|   | We account for our regulated operations in accordance with the accounting principles promulgated for each of the regulated enterprises.  This accounting recognizes the economic effects of rate regulation by recording cost and a return on investment as such amounts are recovered through rates authorized by regulatory authorities.  Accordingly, plant and equipment is depreciated over lives approved by regulators and certain costs and obligations are deferred based upon approvals received from regulators to permit recovery of such amounts in future years.  Our cost studies and depreciation rates for our regulated operations are subject to periodic audits that could result in a change to recorded revenues. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | (f) | Earnings per Common Share |
|--------|-----|---------------------------|

|   | The preparation of financial statements in conformity with GAAP requires us 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. Significant items subject to estimates and assumptions include the allowance for doubtful receivables, unbilled revenues, accrual of the Universal Service Fund (“USF”) high cost area program support, share-based compensation, inventory reserves, reserve for future customer credits, valuation allowances for deferred income tax assets, depreciable and amortizable lives of assets, the carrying value of long-lived assets including goodwill, cable certificates and wireless licenses, purchase price allocations, deferred lease expense, asset retirement obligations, the accrual of Cost of Goods Sold, and the accrual of contingencies and litigation. Actual results could differ from those estimates. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (h) | Income Taxes |
|--------|-----|--------------|

|   | GCI, Inc., as a wholly-owned subsidiary and member of the GCI controlled group of corporations, files its income tax returns as part of the consolidated group of corporations under GCI.  Accordingly, all discussions regarding income taxes reflect the consolidated group's activity.  Our income tax expense and deferred income tax assets and liabilities are presented herein using the separate-entity method. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (i) | Classification of Taxes Collected from Customers |
|--------|-----|--------------------------------------------------|

|   | We report sales, use, excise, and value added taxes assessed by a governmental authority that are directly imposed on a revenue-producing transaction between us and a customer on a net basis in our income statement.  We report a certain surcharge on a gross basis in our income statement of $1.3 million and $916,000 for the three months ended March 31, 2010 and 2009, respectively. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Consolidated Statements of Cash Flows Supplemental Disclosures |
|-----|----------------------------------------------------------------|

|   | Changes in operating assets and liabilities consist of (amounts in thousands): |
|--------|--------------------------------------------------------------------------------|

| Three month period ended March 31,                               |   | 2010   |   |   | 2009   |   |
|------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|
| Decrease in accounts receivable                                  |   | $      | 11,826 |   |   |   | 6,650 |   |
| Increase in prepaid expenses                                     |   |   | (2,726 | )      |   |   | (309 | ) |
| Decrease in inventories                                          |   |   | 2,218  |   |   |   | 286 |   |
| (Increase) decrease in other current assets                      |   |   | 301    |   |   |   | (612 | ) |
| Increase in other assets                                         |   |   | (116   | )      |   |   | --- |   |
| Decrease in accounts payable                                     |   |   | (1,710 | )      |   |   | (633 | ) |
| Increase (decrease) in deferred revenues                         |   |   | 223    |   |   |   | (91 | ) |
| Decrease in accrued payroll and payroll related obligations      |   |   | (4,649 | )      |   |   | (4,650 | ) |
| Increase (decrease) in accrued liabilities                       |   |   | (3,408 | )      |   |   | 2,353 |   |
| Increase (decrease) in accrued interest                          |   |   | 3,263  |   |   |   | (6,456 | ) |
| Increase (decrease) in subscriber deposits                       |   |   | (134   | )      |   |   | 124 |   |
| Decrease in long-term deferred revenue                           |   |   | (518   | )      |   |   | (221 | ) |
| Increase (decrease) in components of other long-term liabilities |   |   | (545   | )      |   |   | 44 |   |
|                                                             |   | $      | 4,025  |   |   |   | (3,515 | ) |

----

| Net cash paid or received:                |   | 2010 |   |   | 2009   |   |
|-------------------------------------------|--------|------|--------|--------|--------|--------|
| Interest paid, net of amounts capitalized |   | $    | 13,825 |   |   |   | 18,952 |   |
| Income tax refund received                |   | $    | 988    |   |   |   | --- |   |

|                                                            |   | 2010 |   |   | 2009   |   |
|-----------------------------------------------------------------|--------|------|--------|--------|--------|--------|
| Non-cash additions for purchases of property and equipment      |   | $    | 2,354  |   |   |   | 3,868 |   |
| Asset retirement obligation additions to property and equipment |   | $    | 386    |   |   |   | --- |   |
| Warranty receivable applied to capital lease obligation         |   | $    | ---    |   |   |   | 465 |   |

|  (3) | Intangible Assets |
|-----------|-------------------|

|                 |   | Three Months Ended |   |
|----------------------|--------|--------------------|--------|
|                 |   | March 31,          |   |
|                 |   | 2010               |   | 2009 |   |
| Amortization expense |   | $                  | 1,711  |   |   |   | 1,881 |   |

| Years Ending December 31, |   |   |   |
|---------------------------|--------|--------|--------|
| 2010                      |   | $      | 5,203  |   |
| 2011                      |   |   | 4,325  |   |
| 2012                      |   |   | 2,877  |   |
| 2013                      |   |   | 1,799  |   |
| 2014                      |   |   | 945    |   |

----

| (4) | Long-Term Debt |
|-----|----------------|

|   | 2019 Notes |
|--------|------------|

|   | On November 3, 2009, we privately placed $425.0 million of 8.625% Senior Notes due 2019 (“2019 Notes”). Simultaneously with the private placement, we entered into a registration rights agreement with the initial purchasers of the 2019 Notes. The registration rights agreement required us to use our reasonable best efforts to file a registration statement on or before March 3, 2010, and requires us to cause the registration statement to become effective on or prior to June 1, 2010, and to complete the exchange offer on or before 30 days following the effective date of the registration statement.   If the exchange offer does not meet such deadlines, the annual interest rate on the 2019 Notes will increase by 0.25%. The annual interest rate on the 2019 Notes will increase by an additional 0.25% for each subsequent 90-day period during which the registration default continues, up to a maximum additional interest rate of 1.0% per year over the interest rate of 8.625% until such deadlines are met. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Total Leverage Ratio (as defined) |   | Applicable Margin |   |
|-----------------------------------|--------|-------------------|--------|
| >3.75                          |   |              | 4.00   | % |
| >3.25 but <3.75             |   |              | 3.50   | % |
| >2.75 but <3.25             |   |              | 3.00   | % |
| <2.75                          |   |              | 2.50   | % |

| (5) | Financial Instruments |
|-----|-----------------------|

----

|                                                     |    | March 31, 2010  |   | December 31, 2009 |    |
|----------------------------------------------------------|---------|-----------------|--------|-------------------|---------|
|                                                     |    | Carrying Amount |   | Fair Value        |    | Carrying Amount |   | Fair Value |   |
| Current and long-term debt and capital lease obligations |  $ | 874,525         |   |              | 849,358 |   | 872,294 |   |   | 834,152 |   |
| Other liabilities                                        |    | 71,951          |   |              | 71,252  |   | 72,770 |   |   | 71,623 |   |

|   | Current and long-term debt and capital lease obligations:  The fair value of our 2019 Notes, 2014 Notes, Rural Utilities Service ("RUS") debt, CoBank mortgage note payable, and capital leases are valued based on quoted market prices on the same or similar issues or on the current rates offered to us of the same remaining maturities. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Other Liabilities:  Deferred compensation liabilities are carried at fair value, which is the amount payable as of the balance sheet date. Asset retirement obligations are recorded at their fair value and, over time, the liability is accreted to its present value each period. Lease escalation liabilities are valued at the discounted amount of future cash flows using quoted market prices on current rates offered to us. Our non-employee share-based compensation awards are reported at their fair value at each reporting period. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                                      |   | Fair Value Measurement at Reporting Date Using               |   |
|---------------------------------------------------------------------------|--------|--------------------------------------------------------------|--------|
| March 31, 2010 Assets                                                     |   | Quoted Prices in Active Marketsfor IdenticalAssets (Level 1) |   |   | Significant Other Observable Inputs (Level 2) |   |   | Significant Unobservable Inputs (Level 3) |   |
|     Money market funds                                     |   | $                                                            | 19     |   |   |   | --- |   |   |   | --- |   |
|     U.S. government and agency obligations                 |   |                                                         | 886    |   |   |   | --- |   |   |   | --- |   |
|     Deferred compensation plan assets (money market funds) |   |                                                         | 1,548  |   |   |   | --- |   |   |   | --- |   |

----

|     Total assets at fair value                             |   | $      | 2,453  |   |   |   | ---    |   |   |   | ---    |   |
|---------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
|                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |
| December 31, 2009 Assets                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|     Money market funds                                     |   | $      | 12     |   |   |   | ---    |   |   |   | ---    |   |
|     U.S. government and agency obligations                 |   |   | 883    |   |   |   | ---    |   |   |   | ---    |   |
|     Deferred compensation plan assets (money market funds) |   |   | 1,522  |   |   |   | ---    |   |   |   | ---    |   |
|     Total assets at fair value                             |   | $      | 2,417  |   |   |   | ---    |   |   |   | ---    |   |

|   |   | The following is a summary of our share-based compensation expense for the three months ended March 31, 2010 and 2009 (in thousands): |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------|

|                                                    |   | 2010   |   |   | 2009   |   |
|---------------------------------------------------------|--------|--------|--------|--------|--------|--------|
| Employee share-based compensation expense               |   | $      | 1,066  |   |   |   | 2,259 |   |
| Adjustment to fair value of liability classified awards |   |   | (263   | )      |   |   | (457 | ) |
| Total share-based compensation expense                  |   | $      | 803    |   |   |   | 1,802 |   |

----

| Options                               |   | Shares |   |   | WeightedAverageExercise Price |   |   | Weighted Average Remaining Contractual Term |   |   | Aggregate Intrinsic Value |   |
|---------------------------------------|--------|--------|--------|--------|-------------------------------|--------|--------|---------------------------------------------|--------|--------|---------------------------|--------|
| Outstanding at December 31, 2009      |   |   | 1,627  |   |                          | $      | 7.35   |                                        |   |   |                      |   |   |   |
| Granted                               |   |   | 201    |   |                          | $      | 5.32   |                                        |   |   |                      |   |   |   |
| Exercised                             |   |   | (15    | )      |                          | $      | 4.94   |                                        |   |   |                      |   |   |   |
| Forfeited and retired                 |   |   | (349   | )      |                          | $      | 7.84   |                                        |   |   |                      |   |   |   |
| Outstanding at March 31, 2010         |   |   | 1,464  |   |                          | $      | 6.97   |                                        |   |   | 5.0                       |   |   | $ | 247 |   |
| Exercisable at March 31, 2010         |   |   | 1,000  |   |                          | $      | 7.08   |                                        |   |   | 3.2                       |   |   | $ | 158 |   |
| Available for grant at March 31, 2010 |   |   | 4,162  |   |                          |   |   |                                        |   |   |                      |   |   |   |   |   |

| Nonvested Restricted Stock Awards |   | Shares |   |   | Weighted AverageGrant Date Fair Value |   |
|-----------------------------------|--------|--------|--------|--------|---------------------------------------|--------|
| Nonvested at December 31, 2009    |   |   | 2,225  |   |                                  | $      | 5.69 |   |
| Granted                           |   |   | 126    |   |                                  | $      | 5.41 |   |
| Vested                            |   |   | (82    | )      |                                  | $      | 12.99 |   |
| Forfeited                         |   |   | (17    | )      |                                  | $      | 9.44 |   |
| Nonvested at March 31, 2010       |   |   | 2,252  |   |                                  | $      | 5.38 |   |

|                                  |   | Shares(in thousands) |   |   | WeightedAverageExercise Price |   |
|---------------------------------------|--------|----------------------|--------|--------|-------------------------------|--------|
| Outstanding at December 31, 2009      |   |                 | 150    |   |                          | $      | 6.50 |   |
| Options forfeited and retired         |   |                 | (150   | )      |                          | $      | 6.50 |   |
| Outstanding at March 31, 2010         |   |                 | ---    |   |                          |   | --- |   |
|                                  |   |                 |   |   |                          |   |   |   |
| Available for grant at March 31, 2010 |   |                 | ---    |   |                          |   |   |   |

----

| (7) | Industry Segments Data |
|-----|------------------------|

|   |    | Corporate related expenses including engineering, information technology, accounting, legal and regulatory, human resources, and other general and administrative expenses for the three months ended March 31, 2010 and 2009 are allocated to our segments using segment margin for the years ended December 31, 2009 and 2008, respectively.  Bad debt expense for the three months ended March 31, 2010 and 2009 is allocated to our segments using a combination of specific identification and allocations based upon segment revenue for the three months ended March 31, 2010 and 2009, respectively.  Corporate related expenses and bad debt expense are specifically identified for our Regulated Operations segment and therefore, are not included in the allocations. |
|--------|--------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Three months ended March 31, |   | Consumer |   |   | Network Access |   |   | Commercial |   |   | Managed Broadband |   |   | Regulated Operations |   |   | Total Reportable Segments |   |
|------------------------------|--------|----------|--------|--------|----------------|--------|--------|------------|--------|--------|-------------------|--------|--------|----------------------|--------|--------|---------------------------|--------|
| 2010                         |   |     |   |   |           |   |   |       |   |   |              |   |   |                 |   |   |                      |   |
| Revenues:                    |   |     |   |   |           |   |   |       |   |   |              |   |   |                 |   |   |                      |   |
| Intersegment                 |   | $        | ---    |   |           |   | 6      |       |   |   | 1,330             |   |   |                 | ---    |   |                      |   | 40 |   |   |   | 1,376 |   |
| External                     |   |     | 80,368 |   |           |   | 26,183 |       |   |   | 27,723            |   |   |                 | 12,085 |   |                      |   | 6,060 |   |   |   | 152,419 |   |
| Total revenues               |   | $        | 80,368 |   |           |   | 26,189 |       |   |   | 29,053            |   |   |                 | 12,085 |   |                      |   | 6,100 |   |   |   | 153,795 |   |
| Adjusted EBITDA              |   | $        | 25,953 |   |           |   | 11,991 |       |   |   | 6,357             |   |   |                 | 4,914  |   |                      |   | 1,843 |   |   |   | 51,058 |   |
|                         |   |     |   |   |           |   |   |       |   |   |              |   |   |                 |   |   |                      |   |   |   |   |   |   |   |
| 2009                         |   |     |   |   |           |   |   |       |   |   |              |   |   |                 |   |   |                      |   |   |   |   |   |   |   |
| Revenues:                    |   |     |   |   |           |   |   |       |   |   |              |   |   |                 |   |   |                      |   |   |   |   |   |   |   |
| Intersegment                 |   | $        | ---    |   |           |   | 227    |       |   |   | 1,456             |   |   |                 | ---    |   |                      |   | 52 |   |   |   | 1,735 |   |
| External                     |   |     | 70,719 |   |           |   | 33,199 |       |   |   | 27,992            |   |   |                 | 10,610 |   |                      |   | 6,169 |   |   |   | 148,689 |   |
| Total revenues               |   | $        | 70,719 |   |           |   | 33,426 |       |   |   | 29,448            |   |   |                 | 10,610 |   |                      |   | 6,221 |   |   |   | 150,424 |   |
| Adjusted EBITDA              |   | $        | 18,778 |   |           |   | 16,919 |       |   |   | 5,301             |   |   |                 | 3,918  |   |                      |   | 1,532 |   |   |   | 46,448 |   |

|                                                   |   | Three Months Ended |    |
|--------------------------------------------------------|--------|--------------------|---------|
|                                                   |   | March 31,          |    |
|                                                   |   | 2010               |    |   | 2009 |   |
| Reportable segment revenues                            |   | $                  | 153,795 |   |   |   | 150,424 |   |
| Less intersegment revenues eliminated in consolidation |   |               | 1,376   |   |   |   | 1,735 |   |
| Consolidated revenues                                  |   | $                  | 152,419 |   |   |   | 148,689 |   |

|                                          |   | Three Months Ended |   |
|-----------------------------------------------|--------|--------------------|--------|
|                                          |   | March 31,          |   |
|                                          |   | 2010               |   |   | 2009 |   |
| Reportable segment adjusted EBITDA            |   | $                  | 51,058 |   |   |   | 46,448 |   |
| Less depreciation and amortization expense    |   |               | 31,126 |   |   |   | 30,734 |   |
| Less share-based compensation expense         |   |               | 803    |   |   |   | 1,802 |   |
| Less non-cash contribution adjustment         |   |               | ---    |   |   |   | 400 |   |
| Consolidated operating income                 |   |               | 19,129 |   |   |   | 13,512 |   |
| Less other expense, net                       |   |               | 17,619 |   |   |   | 12,639 |   |
| Consolidated income before income tax expense |   | $                  | 1,510  |   |   |   | 873 |   |

----

| (8) | Commitments and Contingencies |
|-----|-------------------------------|

----

----

----

|                       |   | Reportable Segments |   |
|----------------------------|--------|---------------------|--------|
| Services and Products      |   | Consumer            |   |   | Network Access |   |   | Commercial |   |   | Managed Broadband |   |   | Regulated Operations |   |
| Voice:                     |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Long-distance              |   |                | X      |   |   |   | X |   |   |   | X |   |   |   |   |   |   | X |   |
| Local Access               |   |                | X      |   |   |   | X |   |   |   | X |   |   |   |   |   |   | X |   |
| Directories                |   |                |   |   |   |   |   |   |   |   | X |   |   |   |   |   |   |   |   |
|                       |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Video                      |   |                | X      |   |   |   |   |   |   |   | X |   |   |   |   |   |   |   |   |
|                       |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Data:                      |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Internet                   |   |                | X      |   |   |   | X |   |   |   | X |   |   |   | X |   |   |   | X |   |
| Data Networks              |   |                |   |   |   |   | X |   |   |   | X |   |   |   | X |   |   |   |   |   |
| Managed Services           |   |                |   |   |   |   |   |   |   |   | X |   |   |   | X |   |   |   |   |   |
| Managed Broadband Services |   |                |   |   |   |   |   |   |   |   |   |   |   |   | X |   |   |   |   |   |
|                       |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Wireless                   |   |                | X      |   |   |   | X |   |   |   | X |   |   |   |   |   |   |   |   |   |

|                                         |   |               |   |   | Percent­age |   |
|----------------------------------------------|--------|--------------------|--------|--------|------------------|--------|
|                                         |   | Three Months Ended |   |   | Change 1         |   |
|                                         |   | March 31,          |   |   | 2010             |   |
|                                         |   | 2010               |   |   | 2009             |   |   | vs. 2009 |   |
| (Unaudited)                                  |   |               |   |   |             |   |   |   |   |
| Statements of Operations Data:               |   |               |   |   |             |   |   |   |   |
| Revenues:                                    |   |               |   |   |             |   |   |   |   |
| Consumer segment                             |   |               | 53     | %      |             |   | 48 | % |   |   | 14 | % |
| Network Access segment                       |   |               | 17     | %      |             |   | 22 | % |   |   | (21 | %) |
| Commercial segment                           |   |               | 18     | %      |             |   | 19 | % |   |   | (1 | %) |
| Managed Broadband segment                    |   |               | 8      | %      |             |   | 7 | % |   |   | 14 | % |
| Regulated Operations segment                 |   |               | 4      | %      |             |   | 4 | % |   |   | (2 | %) |
| Total revenues                               |   |               | 100    | %      |             |   | 100 | % |   |   | 3 | % |
| Selling, general and administrative expenses |   |               | 35     | %      |             |   | 38 | % |   |   | (6 | %) |
| Depreciation and amortization expense        |   |               | 20     | %      |             |   | 21 | % |   |   | 1 | % |
| Operating income                             |   |               | 13     | %      |             |   | 9 | % |   |   | 42 | % |
| Other expense, net                           |   |               | 12     | %      |             |   | 9 | % |   |   | 39 | % |
| Income before income tax expense             |   |               | 1      | %      |             |   | 1 | % |   |   | 73 | % |
| Net income                                   |   |               | 1      | %      |             |   | 0 | % |   |   | 373 | % |

----

|                           |   |   |   |   | Percentage |   |
|--------------------------------|--------|--------|--------|--------|------------|--------|
|                           |   | 2010   |   |   | 2009       |   |   | Change |   |
| Voice                          |   | $      | 13,856 |   |       |   | 13,915 |   |   |   | 0 | % |
| Video                          |   |   | 29,024 |   |       |   | 27,370 |   |   |   | 6 | % |
| Data                           |   |   | 14,126 |   |       |   | 11,762 |   |   |   | 20 | % |
| Wireless                       |   |   | 23,362 |   |       |   | 17,672 |   |   |   | 32 | % |
| Total Consumer segment revenue |   | $      | 80,368 |   |       |   | 70,719 |   |   |   | 14 | % |

|                                      |   |   |   |   | Percentage |   |
|-------------------------------------------|--------|--------|--------|--------|------------|--------|
|                                      |   | 2010   |   |   | 2009       |   |   | Change |   |
| Voice                                     |   | $      | 3,335  |   |       |   | 3,717 |   |   |   | (10 | %) |
| Video                                     |   |   | 12,897 |   |       |   | 11,322 |   |   |   | 14 | % |
| Data                                      |   |   | 899    |   |       |   | 1,114 |   |   |   | (19 | %) |
| Wireless                                  |   |   | 8,502  |   |       |   | 7,250 |   |   |   | 17 | % |
| Total Consumer segment Cost of Goods Sold |   | $      | 25,633 |   |       |   | 23,403 |   |   |   | 10 | % |

|                             |   |   |   |   | Percentage |   |
|----------------------------------|--------|--------|--------|--------|------------|--------|
|                             |   | 2010   |   |   | 2009       |   |   | Change |   |
| Consumer segment adjusted EBITDA |   | $      | 25,953 |   |       |   | 18,778 |   |   |   | 38 | % |

|                                             |   | March 31, |    |   | Percentage |   |
|--------------------------------------------------|--------|-----------|---------|--------|------------|--------|
|                                             |   | 2010      |    |   | 2009       |   |   | Change |   |
| Voice:                                           |   |      |    |   |       |   |   |   |   |
| Long-distance subscribers1                       |   |      | 91,200  |   |       |   | 88,700 |   |   |   | 3 | % |
| Long-distance minutes carried (in millions)      |   |      | 28.3    |   |       |   | 29.6 |   |   |   | (4 | %) |
| Total local access lines in service2             |   |      | 85,800  |   |       |   | 81,400 |   |   |   | 5 | % |
| Local access lines in service on GCI facilities2 |   |      | 77,300  |   |       |   | 69,900 |   |   |   | 11 | % |
|                                             |   |      |    |   |       |   |   |   |   |   |   |   |
| Video:                                           |   |      |    |   |       |   |   |   |   |   |   |   |
| Basic subscribers3                               |   |      | 131,400 |   |       |   | 130,000 |   |   |   | 1 | % |
| Digital programming tier subscribers4            |   |      | 81,400  |   |       |   | 76,100 |   |   |   | 7 | % |
| HD/DVR converter boxes5                          |   |      | 86,000  |   |       |   | 72,100 |   |   |   | 19 | % |
| Homes passed                                     |   |      | 232,900 |   |       |   | 229,700 |   |   |   | 1 | % |
| Average monthly gross revenue per subscriber6    |   | $         | 73.80   |   |       | $      | 69.50 |   |   |   | 6 | % |

----

|                                          |   |   |    |   |   |   |   |   |   |   |   |   |
|-----------------------------------------------|--------|--------|---------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Data:                                         |   |   |    |   |   |   |   |   |   |   |   |   |
| Cable modem subscribers7                      |   |   | 103,100 |   |   |   | 94,300 |   |   |   | 9      | %      |
|                                          |   |   |    |   |   |   |   |   |   |   |   |   |
| Wireless:                                     |   |   |    |   |   |   |   |   |   |   |   |   |
| Wireless lines in service8                    |   |   | 117,500 |   |   |   | 97,100 |   |   |   | 21     | %      |
| Average monthly gross revenue per subscriber9 |   | $      | 59.99   |   |   | $      | 58.63  |   |   |   | 2      | %      |

|   |     _________________________________________________________________ |
|--------|-------------------------------------------------------------------------------------------|

|   | 1  A long-distance customer is defined as a customer account that is invoiced a monthly long-distance plan fee or has made a long-distance call during the month. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 2  A local access line in service is defined as a revenue generating circuit or channel connecting a customer to the public switched telephone network. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 3  A basic cable subscriber is defined as one basic tier of service delivered to an address or separate subunits thereof regardless of the number of outlets purchased. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |  4  A digital programming tier subscriber is defined as one digital programming tier of service delivered to an address or separate subunits thereof regardless of the number of outlets or digital programming tiers purchased. Digital programming tier subscribers are a subset of basic subscribers. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 5  A high definition/digital video recorder (“HD/DVR”) converter box is defined as one box rented by a digital programming or basic tier subscriber. A digital programming or basic tier subscriber is not required to rent an HD/DVR converter box to receive service. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 6  Quarter-to-date average monthly consumer video revenues divided by the average of consumer video basic subscribers at the beginning and end of the period. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 7  A cable modem subscriber is defined by the purchase of cable modem service regardless of the level of service purchased. If one entity purchases multiple cable modem service access points, each access point is counted as a subscriber. Cable modem subscribers may also be video basic subscribers though basic cable service is not required to receive cable modem service. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 8  A wireless line in service is defined as a revenue generating wireless device. |
|--------|---------------------------------------------------------------------------------------------|

|   | 9  Quarter-to-date average monthly consumer wireless revenues divided by the average of consumer wireless subscribers at the beginning and end of the period. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | A 6% increase in programming services revenue to $22.9 million in 2010 primarily resulting from an increase in digital programming tier subscribers in 2010 and a rate increase on certain cable service offerings beginning in August 2009, and |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | A 7% increase in equipment rental revenue to $5.7 million in 2010 primarily resulting from our customers’ increased use of our HD/DVR converter boxes. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                 |   |   |   |   | Percentage |   |
|--------------------------------------|--------|--------|--------|--------|------------|--------|
|                                 |   | 2010   |   |   | 2009       |   |   | Change |   |
| Voice                                |   | $      | 6,659  |   |       |   | 14,334 |   |   |   | (54 | %) |
| Data                                 |   |   | 16,329 |   |       |   | 17,954 |   |   |   | (9 | %) |
| Wireless                             |   |   | 3,195  |   |       |   | 911 |   |   |   | 251 | % |
| Total Network Access segment revenue |   | $      | 26,183 |   |       |   | 33,199 |   |   |   | (21 | %) |

|                                            |   |   |   |   | Percentage |   |
|-------------------------------------------------|--------|--------|--------|--------|------------|--------|
|                                            |   | 2010   |   |   | 2009       |   |   | Change |   |
| Voice                                           |   | $      | 3,484  |   |       |   | 4,077 |   |   |   | (15 | %) |
| Data                                            |   |   | 2,753  |   |       |   | 2,486 |   |   |   | 11 | % |
| Wireless                                        |   |   | 291    |   |       |   | 121 |   |   |   | 140 | % |
| Total Network Access segment Cost of Goods Sold |   | $      | 6,528  |   |       |   | 6,684 |   |   |   | (2 | %) |

|                                   |   |   |   |   | Percentage |   |
|----------------------------------------|--------|--------|--------|--------|------------|--------|
|                                   |   | 2010   |   |   | 2009       |   |   | Change |   |
| Network Access segment adjusted EBITDA |   | $      | 11,991 |   |       |   | 16,919 |   |   |   | (29 | %) |

----

|                                                     |   | March 31, |   |   | Percentage |   |
|----------------------------------------------------------|--------|-----------|--------|--------|------------|--------|
|                                                     |   | 2010      |   |   | 2009       |   |   | Change |   |
| Voice:                                                   |   |      |   |   |       |   |   |   |   |
| Long-distance minutes carried (in millions)              |   |      | 193.6  |   |       |   | 200.4 |   |   |   | (3 | %) |
|                                                     |   |      |   |   |       |   |   |   |   |   |   |   |
| Data:                                                    |   |      |   |   |       |   |   |   |   |   |   |   |
| Total Internet service provider access lines in service1 |   |      | 1,700  |   |       |   | 1,700 |   |   |   | 0 | % |

|                             |   |   |   |   | Percentage |   |
|----------------------------------|--------|--------|--------|--------|------------|--------|
|                             |   | 2010   |   |   | 2009       |   |   | Change |   |
| Voice                            |   | $      | 7,843  |   |       |   | 7,984 |   |   |   | (2 | %) |
| Video                            |   |   | 2,317  |   |       |   | 2,050 |   |   |   | 13 | % |
| Data                             |   |   | 15,502 |   |       |   | 16,515 |   |   |   | (6 | %) |
| Wireless                         |   |   | 2,061  |   |       |   | 1,443 |   |   |   | 43 | % |
| Total Commercial segment revenue |   | $      | 27,723 |   |       |   | 27,992 |   |   |   | (1 | %) |

----

|                                        |   |   |   |   | Percentage |   |
|---------------------------------------------|--------|--------|--------|--------|------------|--------|
|                                        |   | 2010   |   |   | 2009       |   |   | Change |   |
| Voice                                       |   | $      | 4,238  |   |       |   | 4,569 |   |   |   | (7 | %) |
| Video                                       |   |   | 498    |   |       |   | 497 |   |   |   | 0 | % |
| Data                                        |   |   | 6,812  |   |       |   | 7,565 |   |   |   | (10 | %) |
| Wireless                                    |   |   | 823    |   |       |   | 724 |   |   |   | 14 | % |
| Total Commercial segment Cost of Goods Sold |   | $      | 12,371 |   |       |   | 13,355 |   |   |   | (7 | %) |

|                               |   |   |   |   | Percentage |   |
|------------------------------------|--------|--------|--------|--------|------------|--------|
|                               |   | 2010   |   |   | 2009       |   |   | Change |   |
| Commercial segment adjusted EBITDA |   | $      | 6,357  |   |       |   | 5,301 |   |   |   | 20 | % |

|   | Selected key performance indicators for our Commercial segment follow: |
|--------|------------------------------------------------------------------------|

|                                              |   | March 31, |   |   | Percentage |   |
|---------------------------------------------------|--------|-----------|--------|--------|------------|--------|
|                                              |   | 2010      |   |   | 2009       |   |   | Change |   |
| Voice:                                            |   |      |   |   |       |   |   |   |   |
| Long-distance subscribers1                        |   |      | 9,400  |   |       |   | 9,700 |   |   |   | (3 | %) |
| Long-distance minutes carried (in millions)       |   |      | 29.6   |   |       |   | 32.2 |   |   |   | (8 | %) |
| Total local access lines in service2              |   |      | 48,400 |   |       |   | 46,900 |   |   |   | 3 | % |
| Local access lines in service on GCI facilities 2 |   |      | 20,400 |   |       |   | 18,000 |   |   |   | 13 | % |
|                                              |   |      |   |   |       |   |   |   |   |   |   |   |
| Data:                                             |   |      |   |   |       |   |   |   |   |   |   |   |
| Cable modem subscribers3                          |   |      | 10,500 |   |       |   | 10,200 |   |   |   | 3 | % |
|                                              |   |      |   |   |       |   |   |   |   |   |   |   |
| Wireless:                                         |   |      |   |   |       |   |   |   |   |   |   |   |
| Wireless lines in service4                        |   |      | 10,600 |   |       |   | 8,000 |   |   |   | 33 | % |

|   | ____________________________________ |
|--------|--------------------------------------|

|   | 1  A long-distance customer is defined as a customer account that is invoiced a monthly long-distance plan fee or has made a long-distance call during the month. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 2  A local access line in service is defined as a revenue generating circuit or channel connecting a customer to the public switched telephone network. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 3  A cable modem subscriber is defined by the purchase of cable modem service regardless of the level of service purchased. If one entity purchases multiple cable modem service access points, each access point is counted as a subscriber. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |  4  A wireless line in service is defined as a revenue generating wireless device. |
|--------|---------------------------------------------------------------------------------------------------|

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|                                                         |   | March 31, |   |   | Percentage |   |
|--------------------------------------------------------------|--------|-----------|--------|--------|------------|--------|
|                                                         |   | 2010      |   |   | 2009       |   |   | Change |   |
| Voice:                                                       |   |      |   |   |       |   |   |   |   |
| Long-distance subscribers1                                   |   |      | 600    |   |       |   | 800 |   |   |   | (25 | %) |
| Long-distance minutes carried (in millions)                  |   |      | 0.1    |   |       |   | 0.3 |   |   |   | (60 | %) |
| Total local access lines in service (all on GCI facilities)2 |   |      | 10,800 |   |       |   | 11,900 |   |   |   | (9 | %) |

|   | ____________________________ |
|--------|------------------------------|

|   | 1  A long-distance subscriber is defined as a customer account that is invoiced a monthly long-distance plan fee or has made a long-distance call during the month. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 2  A local access line in service is defined as a revenue generating circuit or channel connecting a customer to the public switched telephone network. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| ·   | A $1.3 million decrease in contract labor, |
|--------------------|--------------------------------------------|

| ·   | A $1.0 million decrease in share-based compensation expense primarily due to less share-based awards issued, |
|--------------------|--------------------------------------------------------------------------------------------------------------|

| ·   | A $755,000 decrease in our company-wide success sharing bonus accrual, |
|--------------------|------------------------------------------------------------------------|

| ·   | The absence of $748,000 in expense to convert our customers' wireless phones to our facilities, |
|--------------------|-------------------------------------------------------------------------------------------------|

| ·   | A $692,000 decrease in sales expense, and |
|--------------------|-------------------------------------------|

| ·   | The absence of a $400,000 contribution expense recognized upon the gift of an IRU to the University of Alaska that was recorded in 2009. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------|

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|                                                 |   | 2010   |    |   | 2009   |   |
|------------------------------------------------------|--------|--------|---------|--------|--------|--------|
| Operating activities                                 |   | $      | 39,139  |   |   |   | 32,002 |   |
| Investing activities                                 |   |   | (19,264 | )      |   |   | (32,994 | ) |
| Financing activities                                 |   |   | (164    | )      |   |   | (3,402 | ) |
| Net increase (decrease) in cash and cash equivalents |   | $      | 19,711  |   |   |   | (4,394 | ) |

----

----

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| Exhibit No. |   | Description |
|-------------|--------|-------------|
|        | 31.1   |        | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by our President and Director |
|        | 31.2   |        | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by our Senior Vice President, Chief Financial Officer, Secretary and Treasurer |
|        | 32.1   |        | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by our President and Director |
|        | 32.2   |        | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by our Senior Vice President, Chief Financial Officer, Secretary and Treasurer |
|        |   |        |   |
|        |   |        |   |
|        |   |        |   |

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| Signature                   |   | Title                                        |   | Date               |
|-----------------------------|--------|----------------------------------------------|--------|--------------------|
|                        |   |                                         |   |               |
|   /s/ G. Wilson Hughes |   | President and Director                       |   |   May 6, 2010 |
| G. Wilson Hughes            |   | (Principal Executive Officer)                |   |               |
|                        |   |                                         |   |               |
|   /s/ John M. Lowber   |   | Secretary, Treasurer and Director            |   |   May 6, 2010 |
| John M. Lowber              |   | (Principal Financial and Accounting Officer) |   |               |

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