U.S. Securities and Exchange Commission

                             Washington, D.C. 20549

                                   Form 10-QSB


                Quarterly Report Under Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

For the Quarterly Period Ended June 30, 1999

Commission File Number 313-12979


                                 VOICENET, INC.
          (Exact name of small business issuer as specified in charter)

Delaware                                                     13-3896031
(State of either jurisdiction of                            (IRS Employer
Incorporation or organization                               Identification No.)


                                 300 Park Avenue
                                   17th Floor
                               New York, New York
                    (Address of principal executive offices)

                                  212-399-6682
                           (Issuer's telephone number)


       ------------------------------------------------------------------
   (former name, address and former fiscal year, if changed since last report)


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

State the number of shares outstanding of each of the issuer's classes of common
equity as of the lastest practicable date: 3,338,650



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                                 VOICENET, INC.

                                      INDEX


Part I - Financial Statements

         Balance Sheets -June 30, 1999 and December 31, 1998

         Statements  of Operations  and Retained  Deficit - For the Three Months
         Ended June 30, 1999 and June 30, 1998

         Statements  of Cash  Flows for the Six Months  Ended June 30,  1999 and
         June 30, 1998

         Notes to Unaudited Financial Statements

         Management's Discussion and Analysis





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                                 VOICENET, INC.
                                  BALANCE SHEET


ASSETS:                                         June 30, 1999     Dec. 31, 1998
                                                 (unaudited)        (audited)
                                                 -----------        ---------
Current Assets:

Cash and Cash Equivalents                          $ 82,426           $34,610
Investments                                               -            12,246
Accounts Receivables                                 12,424            44,500
Prepaid Expenses                                      7,382                 -
Due from VNA                                              -            45,015

         Total current assets                       102,232           136,371

Organization costs, net                                 900               900
Intangible Assets, net                            4,260,000         4,410,000
Security Deposits                                    12,142            12,475
Deferred Compensation                                                  26,450

         Total Assets                             4,375,274         4,449,825

CURRENT LIABILITIES
Accounts Payable                                     87,903           217,249
Total current liabilities                            87,903           217,249

Stockholders' Equity

Preferred  Stock,  $.01  par  value,
1,000,000 shares  authorized,  no
shares outstanding Common Stock,
$.01 par value, 10,000,000 shares
authorized 3,338,650 and 3,261,550
shares issued and outstanding                        33,387            33,387
Additional Paid in Capital                        6,168,700         6,168,700
Stock Option Outstanding                            916,500           916,500
Other non-owner change in equity                    (15,719)          (15,719)
Retained Deficit                                 (2,815,497)       (2,733,921)
Total stockholders' equity                        4,287,371         4,232,576

Total liabilities and stockholders' equity        4,375,274         4,449,825





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                                 VOICENET, INC.
                  STATEMENTS OF OPERATIONS AND RETAINED DEFICIT
                       FOR THE THREE MONTHS ENDED JUNE 30,


                                                        1999            1998
                                                       ------          ------

Revenues

Interest Income                                             $0         $ 2,381
Other Income                                                 -
Total Income                                                $0         $ 2,381

General and Administrative Expenses                      6,576         157,366
Amortization                                            75,000               -

Total Expenses                                         (81,576)        157,366

Loss from Operations                                   (81,576)       (154,985)

Net Loss                                               (81,576)       (154,985)

Retained Deficit, beginning of period               (2,733,921)       (786,567)
Retained Deficit, end of period                     (2,815,497)      ( 941,552)

Net loss per common share                             ($.02)          ($.05)

Weighted Average number of
shares outstanding during the period                 3,338,650       3,261,550





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                                 VOICENET, INC.
                             STATEMENT OF CASH FLOWS
                            FOR THE SIX MONTHS ENDED
                                    JUNE 30,


                                                       1999             1998
                                                      ------           ------


Net loss                                               (81,576)        (154,985)
Adjustments to reconcile net loss
to net cash provided by operating activities:
Amorization Expense                                    150,000           22,155
(Increase) Decrease in accounts receivable              32,076                -
(Increase) Decrease in due from VNA and
   prepaid expenses                                     37,633          (40,440)
Increase (decrease) in accounts payable               (129,346)         (44,310)

Total adjustments                                      (90,363)         (62,595)

Cash provided (used) by operating activities             8,787         (217,580)

Decrease in investments                                (12,246)
Decrease in security deposits                              333)
Decrease in deferred compensation                      (26,450)

Net increase (decrease) in cash                         47,816         (217,580)

Cash, beginnning of period                              34,610          375,527

Cash, end of period                                    $82,426         $157,947





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                                 VOICENET, INC.
                          NOTES TO FINANCIAL STATEMENTS

                                   (UNAUDITED)

Note 1. Basis of Presentation

The  financial  statements  included  herein have been  prepared by the Company,
without  audit,  pursuant to the rules and  regulations  of the  Securities  and
Exchange  Commission  and reflect all  adjustments  which are, in the opinion of
management,  necessary  to present  fairly the  financial  information  required
herein.  Certain information and footnote  disclosures  normally included in the
financial  statements  prepared in accordance with generally accepted accounting
principles have been omitted  pursuant to such rules and  regulations,  although
management  believes that the  disclosures  are adequate to make the information
presented not misleading.

Note 2: Nature of Business

Voicenet,  Inc. was  incorporated  on April 2, 1996. The Company was established
for the marketing and  distribution of continuous  speech and voice  recognition
systems and digital  audio  reporting,  transcription,  archival  and  retreival
systems in North America, Central America, and South America.

Note 3: Loss Per Share

Net loss per share is computed based on the weighted average number of shares of
common stock outstanding for the periods presented.  The effect of stock options
and  warrants  on the net  loss  per  share  was  antidilutive  for the  periods
presented.


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

General:

The Company was formed in April 1996.  The Company was organized for the purpose
of acquiring and marketing speech recognition technologies and systems developed
by Voicenet (Aust.) Ltd. , an Australian  publicly traded compan,  listed on the
Australian stock exchange, which is the Company's majority shareholder.

The Company had limited  revenues  for the year ended  December  31, 1998 and no
revenues  from the sale of products  for the quarter  ended June 30,  1999.  The
Company has incurred losses since its inception. The Company expects to continue
to incur  operating  costs and possible  losses  therefrom over the next several
years due primarily to expanded




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sales and marketing efforts,  the staffing of offices,  and expenses incurred as
sales personnel seek potential customers for the Company's  products.  There can
be no assurance of when and whether the Company will generate  revenue or become
profitable on a sustained basis, if at all.

RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED JUNE 30, 1999; COMPARED TO JUNE
30, 1998

Net losses  incurred  for the three  months  ended June 30, 1999 were $81,576 as
compared to $154,985 for the three  months ended June 30, 1998.  The Company had
no revenues from sales in either the June 30, 1999 or 1998 quarter.

Total expenses decreased from $157,366 to $81,576 for the periods ended June 30,
1999 and 1998,  respectfully.  The decrease  was due  primarily to a decrease in
travel expenses and professional fees.

As of December 31, 1998 the Company had total assets of  $4,449,825  as compared
to total assets of  $4,375,274  as of June 30, 1999, a decrease of $74,551.  The
Company  had total  liabilities  of $87,903 as of March 31,  1999 as compared to
$217,249 as of December 31, 1998, a decrease of $129,346.

Liquidity:

As of June 30,  1999 the  Company  had  working  capital  deficit  of $14,329 as
compared to a working capital deficit of $80,868 as of December 31, 1998.

The Company does not currently  have any bank  financing or has had any revenues
through from  continuing  operations from June 30, 1999 through the period ended
August 15, 1999.  The Company can not be certain  that its  existing  sources of
cash will be adequate to meet its liquidity requirements.

Unless the Company is able to generate revenues or obtain additional  sources of
financing in the future,  the  continuing  losses  incurred by the Company raise
substantial doubt about the Company's ability to continue as a going concern.






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                                   Signatures


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


September 7, 1999

                                            Voicenet, Inc.


                                            By: /s/ Howard Messer
                                                -------------------------------
                                                Howard Messer
                                                Chief Financial Officer



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