DCI TELECOMMUNICATIONS

                         611 Access Road
                       Stratford, CT 06615

                         (203) 380-0910

================================================================
November 19, 1999

Securities and Exchange Commission
Attn: Document Control
Judiciary Plaza

450 Fifth Street, N.W.
Room 1004 1-4
Washington, DC 20549

RE: DCI Telecommunications, Inc.

Dear Sir/Madam:

Enclosed is Form 10QSB for the period ending September 30, 1999

Sincerely,

/s/Joseph J. Murphy
----------------
Joseph J. Murphy
Chairman & CEO


<PAGE>




                      SECURITIES AND EXCHANGE COMMISSION
                          Washington, DC 20549

                               FORM 10 - QSB

                QUARTERLY REPORT UNDER REGULATION SB OF THE
                       SECURITIES EXCHANGE ACT OF 1934

For the Quarter Ended                        Commission File Number:
 September 30, 1999                                   2-96976-D

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

                      DCI TELECOMMUNICATIONS, INC.

       ------------------------------------------------------
       (Exact Name of Registrant as specified in its charter)

             COLORADO                            84-1155041

          ---------------                  -----------------------
   (State or other jurisdiction          (IRS Employer Identification
  of incorporation or organization)               Number)

           611 Access Road, Stratford, Connecticut  06615

     -------------------------------------------------------------
           (Address and zip code of principal executive offices)

                              (203) 380-0910

                            -----------------
           (Registrant's telephone number, including area code)

Indicate by check mark whether the Registrant (1) has filed all reports required
by Regulation SB of the Securities  Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the Registrant was required to file such
reports),  and (2) has been subject to the filing  requirements for at least the
past 90 days.

                      YES __X__              NO_____

Indicate the number of shares  outstanding  of each of the  issuer/s  classes of
common stock, as of the last practicable date:

Number of Shares Outstanding        Class               Date

----------------------------       -------           ----------
       30,090,759             Common Stock,       September 30, 1999
                             $.0001 par value



<PAGE>



                           DCI TELECOMMUNICATIONS, INC.

                                  Index

                          PART I FINANCIAL INFORMATION

ITEM 1. Financial Statements

       Balance Sheet September 30, 1999 ...................................    3
           Statements of Operations

        Six Months Ended September 30, 1999 and 1998 ......................    5

       Three Months Ended September 30, 1999 and 1998 .....................    5

           Statements of Cash Flow

        Six Months ended September 30, 1999 and 1998 ......................    7

       Notes to Unaudited Financial Statements

        September 30, 1999 ................................................    9


ITEM 2

       Management's Discussion and Analysis or

        Plan of Operations ................................................   11

                                     PART II

       Other Information ..................................................   18

       Signatures .........................................................   20

                                  2


<PAGE>



                      DCI Telecommunications, Inc.
                       Consolidated Balance Sheet

                                   (unaudited)

                                                    September 30,

ASSETS                                                    1999

                                                          ----
Current assets:

Cash                                                  $ 1,276,272
Accounts receivable, net                                3,308,026
Other current assets                                      221,917
Inventory                                                 234,863
Due from shareholders                                      78,661
                                                        ---------
Total Current Assets                                    5,119,739

Fixed assets                                            1,582,076
Less: Accumulated depreciation                           (188,035)
                                                        ---------
Net Fixed Assets                                        1,394,041

Accounts receivable- long term                            724,713
Deposits                                                  172,865
Other assets                                              219,489

Cost in excess of assets acquired

 Travel Source                                             86,379
 Muller Media                                           1,634,436
 Edge Communications                                    6,940,976
                                                       ----------
                                                        8,661,791

Less: Accumulated amortization:                          (599,429)
                                                        ----------
Net cost in excess of assets acquired                   8,062,362
                                                        ----------
Total Assets                                          $15,693,209
                                                       ===========


                                        3
<PAGE>


LIABILITIES AND SHAREHOLDERS' EQUITY                   September 30
                                                           1999

Current Liabilities:                                       ----

Accounts payable and accrued expenses                 $ 6,996,465
Preferred stock dividend                                  838,220
Due to shareholders                                       169,278
Deferred revenue-prepaid phone cards                      175,950
Current portion of long term debt                          75,997
Capital lease payable                                     289,828
Short term note payable                                   172,500
                                                       ----------
Total Current Liabilities                               8,718,238

Long-term debt                                          1,781,314
Accounts payable                                          927,767
Capital lease payable                                     558,031

Redeemable, convertible preferred stock,
$1,000 par and redemption
value, 2,000,000 shares authorized,
2202 shares issued & outstanding                        2,202,500
                                                       ----------
Total Liabilities                                      14,187,850
                                                       ----------
Commitments and Contingencies

Common stock, $.0001 par value,
 500,000,000 shares authorized,
 30,090,759 shares issued and outstanding                   3,009

Paid-in capital                                        33,095,113
Treasury stock (1,356,547 shares at cost)              (1,127,439)

Accumulated deficit subsequent to 12/31/95,
 date of quasi-reorganization (total
 deficit eliminated  $4,578,587)                      (30,465,324)
                                                      -----------
Total Shareholders' Equity                              1,505,359
                                                      -----------
Total Liabilities and Shareholders' Equity            $15,693,209
                                                      ===========



                     See accompanying notes to consolidated
                             financial statements.

                                        4


<PAGE>



                          DCI Telecommunications, Inc.

                      Consolidated Statements of Operations

                                   (unaudited)

                              Three Months Ended      Six Months Ended
                                September 30,           September 30,

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

  Sales - travel         $  352,366 $   286,760 $   649,983   $  617,822
  Sales - products        2,126,633  10,687,898   8,318,475   15,287,674
                          ---------  ----------   ---------   ----------
  Net sales               2,478,999  10,974,658   8,968,458   15,905,496


  Cost of sales - travel    328,485     280,055     571,243      564,949
                - product 2,293,264   9,564,454   9,145,131   13,670,437
                          ---------   ---------   ---------   ----------
  Cost of sales           2,621,749   9,844,509   9,716,374   14,235,386

    Gross profit (loss)    (142,750)  1,130,149    (747,916)   1,670,110

 Selling, general and
  administrative expenses   350,564     689,943     939,366    1,052,350
 Salaries and
  compensation              499,207     662,945    1,056,099   1,162,133
 Professional and
  consulting fees           752,930     102,431    1,089,286     424,316
 Amortization and
  Depreciation              925,767     206,195    1,859,181     431,417
                          ---------   ---------    ---------  ----------
                          2,528 468   1,661,514    4,943,932   3,070,216
 Loss before other       (2,671,218)   (531,365)  (5,691,848) (1,400,106)
   (expense) income

Other income and (expense):
  Loss on master service
     agreement          (13,321,093)         --  (13,321,093)         --
  Gain on dissolution -
     Foreign subsidiary   1,446,399          --    1,446,399          --
  Investment income          72,700      24,746      151,629      42,933
  Interest expense       (1,409,181)     (1,970)  (1,414,890)    (78,962)
                         -----------   ---------  ----------   ---------
                        (13,211,175)     22,776  (13,137,955)    (36,029)



                                        5


<PAGE>




Loss from continuing operations

  before minority

  interest              (15,882,393)   (508,589)(18,829,803) (1,436,135)

Minority interest                --      15,214          --      12,001
                         ------------   -------  ----------- ----------
Loss from continuing    (15,882,393)   (493,375)(18,829,803) (1,424,134)
 operations

Discontinued operations

Loss from discontinued
 CyberFax operations
 (net of applicable income

  tax benefit of $0 in 1998)      --   (148,692)          --   (232,852)
                          -----------   --------  ---------- ----------
Net  loss  before        (15,882,393)  (642,067) (18,829,803)(1,656,986)
 dividends on preferred

 stock

Dividends on preferred
 stock                       (44,070)  (312,400)     (90,120)   (856,351)
                          ----------    -------   ----------  ----------
Net  loss  applicable to
 common shareholders    $(15,926,463) $(954,467)$(18,919,923)$(2,513,337)

                          ==========    =======   ==========   =========
Basic and diluted net loss per common shares:

Loss from continuing
 operations                   $(0.53)    $ (0.03)     $ (0.63)    $(0.12)

Loss from discontinued
 operations                       --     $ (0.01)         --      $(0.01)
                               ------     -------      -------    -------
Net loss per common
 share - basic and diluted    $(0.53)    $ (0.04)     $ (0.63)    $(0.13)
                               ======     =======      =======    =======
Weighted average common
 shares outstanding -

 basic and diluted         29,950,166  21,563,583   29,870,015 19,550,438







                     See accompanying notes to consolidated
                             financial statements.

                                        6
<PAGE>

                           DCI Telecommunications, Inc

                      Consolidated Statements of Cash Flows

                                   (unaudited)

                                               Six Months Ended
                                                 September 30

                                               1999          1998
                                               ----          ----
Reconciliation of net loss to
   net cash used in operating activities:
Net loss from continuing operations      $ (18,829,803) $(1,424,134)
                                            ----------   ----------
Adjustments to reconcile net loss from
continuing operations to net cash
  used in operating activities:
        Amortization and depreciation        1,859,181      431,701
        Discontinued operations                            (232,852)
        Minority interest                           --       12,001
        Loss on master service agreement    13,321,093           --
        Gain on foreign subsidiary
        dissolution                         (1,446,399)          --
        Accrued interest converted to note   1,348,605           --

   Changes in assets and liabilities:
     (Increase) Decrease in:
        Restricted cash                           ----        25,771
        Accounts receivable                 (2,806,153)   (1,682,884)
        Inventory                             (115,030)     (936,083)
        Deposits                                51,242       (27,344)
        Prepaid expenses                            --      (434,561)
        Other current assets                   162,528            --

     Increase (Decrease):
        Accounts payable & accrued expenses   5,834,194      527,483
        Deferred revenue                        (91,993)     440,109
        Current portion of long term debt         3,405           --
                                             -----------   ---------
            Total adjustments:               18,120,673   (1,876,659)
                                            ------------  ----------
Net cash  used in  operating activities      (  709,130)  (3,300,793)
                                            ------------  ----------
Cash flows from investing activities:
        Additions to fixed assets             (152,276)     (475,495)
        Cash acquired with acquisitions           ----     1,548,947
        Investment in Muller Media                  --    (2,000,000)
        Increase in long term assets           (61,377)           --
                                            ----------   -----------
Net cash used in investing activities         (213,653)     (926,548)
                                            ----------   -----------

                                        7
<PAGE>

Cash flows from financing activities:
        Proceeds from stock
            options exercised                   51,275        432,007
        Purchase of treasury stock                  --       (355,318)
        Payment of notes payable              (300,000)    (4,938,942)
        Increase in long term debt                  --        101,320
        Proceeds from sale of preferred
            stock                                   --      2,750,000
        Due to joint venture                        --        677,076
        Due to shareholders                    (26,027)
        Advances from shareholders               8,775       (368,058)
        Proceeds from issuance
           of notes payable                    872,500            --
        Payment of long-term debt              (38,654)           --
        Sale of equity securities                   --      8,124,761
        Common dividend                             --       (203,962)
                                             ---------     ----------
Net cash from financing activities             567,869      6,218,884
                                             ----------    ----------
Net (decrease) increase in cash               (354,914)     1,991.543

Cash, beginning of period                    1,631,186        704,991
                                             ---------    -----------
Cash, end of period                         $1,276,272    $ 2,696,534
                                             ---------    -----------

Supplemental disclosures of cash flow information:

Cash paid for interest                      $   64,000    $    91,000
                                             =========     ==========

Non-cash investing and financing transactions:
  Acquisitions by stock
      Edge Communications                     $     --    $ 6,823,586
                                                ======      =========
  Preferred stock dividends                   $ 90,120    $   856,351
                                                ======      =========
  Stock issued for other assets               $ 40,000    $       --
                                                ======      =========
  Assets acquired by lease                    $705,757    $       --
                                               =======      =========



                     See accompanying notes to consolidated
                             financial statements.

                                        8


<PAGE>



DCI Telecommunications, Inc.

Notes to Unaudited Consolidated Financial Statements September 30, 1999

NOTE 1.

-------

The accompanying unaudited financial statements have been prepared in accordance
with generally accepted accounting  principles for interim financial information
and with the provisions of Regulation SB.  Accordingly,  they do not include all
of the  information  and  footnotes  required by generally  accepted  accounting
principles for complete financial statements. In the opinion of management,  all
adjustments  (consisting of normal recurring  adjustments)  considered necessary
for a fair presentation have been included.  Certain  restatements of prior year
numbers  have been made to conform to the  current  years  presentations  and to
account for discontinued operations.

The consolidated  financial  statements  include the accounts of the Company and
its wholly and majority owned subsidiaries.  Material inter-company balances and
transactions have been eliminated in consolidation.

The  results  of  operations  for the  periods  presented  are  not  necessarily
indicative  of the results to be expected  for the full year.  The  accompanying
financial  statements  should be read in  conjunction  with the  Company's  form
10-KSB filed for the year ended March 31, 1999.

Loss per share was computed  using the weighted  average number of common shares
outstanding.

NOTE 2.  Common and Preferred Stock

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

In  April  1998,  the  Company  issued  $3,000,000  of  Series  F 8%  non-voting
convertible  preferred  shares.  The shares were  convertible to common stock 90
days from the issue date at the lesser of 75% of the  average  closing bid price
of the common stock for the ten days prior to  conversion  or $4 per share.  The
securities were to be converted into common shares within two years of the issue
date. In connection with this offering 50,000 warrants  exercisable at $1.56 for
a period of five  years  from the issue  date were  granted  to these  preferred
shareholders  and 50,000  warrants,  at the same terms,  were granted to certain
individuals  as finder fees for the placement of the  preferred  shares with the
investors.

During the six months ended September 30, 1999,  $110,000 of preferred shares of
Series F Convertible Preferred Stock were converted to 246,777 common shares.

Interest  and  penalties  associated  with the Series F  preferred  stock,  were
included in new notes issued in November  1999.  (see Note  6-Subsequent  Event-
Financing)

In addition, options to purchase 2,200 common shares were exercised.

                                        9
<PAGE>

NOTE 3. Capital Lease

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

In the quarter  ended June 30, 1999 the Company  entered  into a  commitment  to
lease from Harris Digital  Telephone Systems a debit card platform and switching
equipment  valued at $806,287.  The Company  advanced  $100,000.  Monthly  lease
payments of $24,152 are expected to commence in November 1999. The lease term is
thirty-six  months after which DCI can buy the switch for $1. The lease has been
recorded as a capital lease.

NOTE 4. DCI Europe Limited

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

On September 1, 1999,  DCI Europe Limited (a subsidiary of DCI and since renamed
Gloucester  Communications Limited) which had been served an Involuntary Winding
Up Order was placed in liquidation.  At September 30, 1999, the remaining assets
and liabilities were written off, resulting in a $1,446,399 gain.

NOTE 5. Master Service Agreement Write Off

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

As more fully  described in the  footnotes to the  financial  statements  in the
March 31, 1999 Form 10K, on December 3, 1998 the Company and IXC  Communications
Inc, entered into a stock acquisition  agreement whereby IXC received  3,750,000
shares of DCI common stock in return for a Master Service  Agreement valued at $
15,671,875. The agreement was to provide DCI with most favorable rates, a credit
line and  co-location  of equipment and other shared  facilities in addition DCI
was to receive  switch  equipment  from a third party as part of a different but
related agreement.

As of September 30, 1999,  the Company  believes it has not received rates which
are competitive, has not received the switching equipment, and has suspended all
business  with IXC. As a result,  the  company  has  written  off the  remaining
unamortized investment totaling $ 13,321,093.

Note 6. Subsequent Event - Financing

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

On  November  12,  1999,  the  Company  received  $1,000,000,  as  part of a new
financing  package.  An  existing  loan  of  $400,000,  interest  and  penalties
associated with the Series F Preferred  Stock totaling $ 1,348,605,  and the new
$1,000,000  proceeds  advanced,  are all  included  in new five year  notes with
interest  at six  percent  per  annum.  The  lenders  have  various  methods  of
redemption  to choose  from,  including  cash from VAT  refunds  from the United
Kingdom,  proceeds from the sale of Muller Media if any, and conversion into DCI
common stock at $0.25 per share subject to certain conditions.

                                       10
<PAGE>

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

Overview

--------

The following  discussion  and analysis  provides  information  that  management
believes   is   relevant   to   an   assessment   and   understanding   of   DCI
Telecommunications,  Inc.  and its  subsidiaries  (collectively,  the  Company),
consolidated  results of operations  and financial  condition for the six months
ended September 30, 1999. The discussion  should be read in conjunction with the
Company's consolidated financial statements and accompanying notes.

The  Company,  since its  recent  acquisitions,  operates  predominantly  in the
telecommunications  industry  providing a broad range of communication  service.
The Company's services include long distance  telephone  service,  prepaid phone
cards,  motion  picture  distribution  and a travel  agency.  Through  continued
investments  and business  acquisitions,  the Company is expanding  its business
into rapidly developing markets in Europe.

Recent Acquisitions and Dispositions

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

CYBERFAX, INC.

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

On March 30, 1999, DCI Telecommunications  sold all of the outstanding shares of
common stock of its subsidiary CyberFax,  Inc. to Carlyle Corporation,  a Nevada
corporation.  DCI  received a $5,000,000  promissory  note from Carlyle that was
payable  on  March  30,  2000,  and bore  interest  at 9%,  paid and  compounded
quarterly.

In June 1999, with the agreement of DCI and some modifications of the agreement,
Carlyle  assigned all its rights and  obligations  to SmartFax,  Inc., a private
Canadian corporation.  At the closing,  SmartFax paid off its promissory note by
issuing 5,000,000 shares of its common stock to DCI. No value has been placed on
the SmartFax  shares and no revenue or profit has been recorded.  It is expected
that SmartFax will attempt an initial public offering in the future.

CyberFax  had sales of $48,145 and  operating  losses of $404,010 in fiscal year
end March 31, 1999 before discontinuance of operations. A loss of $1,098,228 was
recorded on this transaction at March 31, 1999.

                                       11


<PAGE>



DCI Europe Limited

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

On September 1, 1999,  DCI Europe Limited (a subsidiary of DCI and since renamed
Gloucester  Communications Limited) which had been served an Involuntary Winding
Up Order was placed in liquidation.  At September 30, 1999, the remaining assets
and liabilities were written off, resulting in a $1,446,399 gain.

Master Service Agreement Write Off

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

As more fully  described in the  footnotes to the  financial  statements  in the
March 31, 1999 Form 10K, on December 3, 1998 the Company and IXC  Communications
Inc, entered into a stock acquisition  agreement whereby IXC received  3,750,000
shares of DCI common stock in return for a Master Service  Agreement valued at $
15,671,875. The agreement was to provide DCI with most favorable rates, a credit
line and  co-location  of equipment and other shared  facilities in addition DCI
was to receive  switch  equipment  from a third party as part of a different but
related agreement.

As of September 30, 1999,  the Company  believes it has not received rates which
are competitive, has not received the switching equipment, and has suspended all
business  with IXC. As a result,  the  company  has  written  off the  remaining
unamortized investment totaling $ 13,321,093.

Liquidity and Capital Resources

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

At  September  30,  1999 the  Company  had  unrestricted  cash of  approximately
$1,276,000.  Net cash declined $355,000 during the last six months. Cash used in
operating  activities  approximated  $710,000 and cash  invested in fixed assets
totaled $152,000.

The Company  supported  those  needs by raising  $872,500  from the  issuance of
notes, of which $300,000 was paid back by September 30.

The write off of the Master Service Agreement, of $13,321,000,  the interest and
penalties on the Series F Preferred Stock and the $1,446,000 gain on dissolution
of DCI Europe were non-cash transactions and had no impact on liquidity.

In November 1999, the Company raised $1,000,000 in debt financing (See Note 6).

The Company is planning  on further  expansion  in Europe and the ability of the
Company to finance all new and existing  operations will be heavily dependent on
external  sources.  No assurance can be given that additional  financing will be
available or, if available, will be on acceptable terms.

                                       12
<PAGE>

Year 2000 Issues

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

The Year 2000 issue is the result of computer  programs  being written using two
digits rather than four to define the applicable year.  Date-sensitive  software
may recognize a date using "00" as the year 1900 rather than the Year 2000. This
could  result in system  failures  or  miscalculations  causing  disruptions  of
operations,   including,   among  others,  a  temporary   inability  to  process
transactions, send invoices or engage in similar normal business activities.

COMPANY'S STATE OF READINESS

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

One of the  Company's  critical  internal  areas is its  information  technology
systems,  including general ledger, accounts receivable,  payable, inventory and
related  packages  for DCI and each of its  subsidiaries.  In this  regard,  the
parent  Company has  installed  new software  and has  installed or upgraded the
financial systems in each of its subsidiaries to be Year 2000 compliant.

All of the  Company-owned  switches,  used to direct and monitor  long  distance
telephone  traffic,   currently  are  Year  2000  compliant   according  to  the
manufacturer.

The Company also has relationships  with outside third parties that could impact
its business.  The most  important are the carriers that process and monitor the
Company's long distance and prepaid phone card calls. All the carriers expect to
be Year 2000  compliant and are in various  stages of  readiness.  The Company's
travel  business  is  partially  dependent  on  an  outside  reservation  system
representing many airlines which is Year 2000 compliant.

COSTS

----------

The Company has  addressed  Year 2000 issues  in-house and, at the present time,
there are no other anticipated costs. Total costs were approximately $ 45,000.


RISK

----

The  Company  believes  that its most  reasonable  likely  worst-case  Year 2000
scenario  would be if any of its third party long  distance  telephone  carriers
were  unable to properly  monitor or admit  authorized  personal  identification
numbered prepaid phone card calls through their systems.

                                       13
<PAGE>

The time frame for the carrier to fix the problem, or the ability of the Company
to recall  prepaid  phone cards and switch to another  carrier with  competitive
rates, could cause a material business interruption.

The risks associated with the failure of the Company's  financial  software,  or
third party payroll  preparation and stock transfer system,  are considered less
severe in that the Company  believes  switching to other  vendors or using other
methods would be relatively easy.

The risk of failure of the third party  airline  reservation  system is that the
Company  would have to secure its travel  arrangements  by methods that would be
more cumbersome and time-consuming than the current automated system.

CONTINGENCY PLAN

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

The Company, based upon a survey conducted with major suppliers,  especially for
financial  reporting and  telecommunication  services,  is satisfied  that these
suppliers are able to meet all Year 2000  requirements and therefore will not be
preparing a contingency plan.

The  Company  has  upgraded  its  internal  accounting  systems  to  meet  these
requirements.

Cautionary Statement for Purposes of the "Safe Harbor" Provisions of the Private
Securities Litigation Reform Act of 1995

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

This report  contains or incorporates  by reference  forward-looking  statements
within the  meaning of the  Private  Securities  Litigation  Reform Act of 1995.
Where any such forward-looking statement includes a statement of the assumptions
or bases underlying such  forward-looking  statement,  the Company cautions that
assumed  facts or bases  almost  always  vary from the actual  results,  and the
differences  between  assumed facts or bases and actual results can be material,
depending upon the circumstances.  Where, in any forward-looking  statement, the
Company  or its  management  expresses  an  expectation  or  belief as to future
results,  there can be no assurance  that the statement of expectation or belief
will result or be  achieved  or  accomplished.  The words  "believe",  "expect",
"estimate",   "anticipate",  "project"  and  similar  expressions  may  identify
forward-looking statements.

                                   14
<PAGE>

Consolidated Results of Operations

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

                                              Six months Ended
                                               September 30,
                                            1999           1998
                                            ----           ----
Net Sales                                $8,968,458    $15,905,496
--------

Net sales declined $ 6,937,000 in the six months ending September 30,

1999,  compared  to the same  period a year  ago.  Sales of Edge  Communications
declined $ 7,104,000  during this period,  principally as a carryover  result of
the shutdown of prepaid  phone cards  during the last fiscal  year.  Due to this
shutdown,  Edge  encountered   difficulties  in  rebuilding  its  business,  and
therefore  it incurred a loss at the gross margin level in its efforts to regain
market  share.  Sales also  declined $ 2,500,000 due to the absence of the joint
venture  Phoneline,  which was written off on March 31, 1999,  but this was more
than offset by increased sales in Europe, principally in England.

                                                       1999        1998
                                                       ----        ----
Cost of Sales                                     $ 9,716,374  $14,235,386
-------------

Cost of sales declined $4,519,000 in the first six months compared to a

year ago. Edge's cost of sales dropped $4,987,000 due to the situation described
above.  However,  the cost of sales Edge did incur was higher than the  original
sales price and resulted in a negative  gross margin for the company as a whole.
Higher  cost of sales in  Europe,  associated  with  higher  sales,  principally
accounts for the reminder of the variance.

                                               1999        1998
                                             --------    --------
Selling, General & Administration Expense  $  939,366   1,052,350
-----------------------------------------

Selling,  general and administrative  expenses declined $113,000, in the current
period compared to last years six month period.  Administrative  expenses in the
expanded  European  operations were  approximately  $144,000 less than the prior
years Phoneline Joint Venture and European costs.

                                15


<PAGE>



                                           1999         1998
                                           ----         ----
Salaries and Compensation              $ 1,056,099 $ 1,162,133
-------------------------

Salaries  declined $106,000 in the 6 months ended September 1999. The absence of
the Phoneline Joint Venture resulted in a $164,000 decline.  Modest increases in
other companies partially offset this decline.

                                         1999        1998
                                         ----        ----
Professional and Consulting Fees      $1,089,286   $424,316

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

Professional  fees increased  $665,000 in the current six month period.  A legal
matter involving Edge's carrier service and switching equipment,  the successful
defense of two lawsuits  against DCI, and legal and accounting  costs associated
with the Securities  and Exchange  Commission  investigation  of the Company and
corresponding  restatements  of financial  statements,  are the main reasons for
this unfavorable variance.

                                          1999        1998
                                          ----        -----
Amortization and Depreciation          $1,859,181   $431,417
-----------------------------

Amortization  and  depreciation  increased  $1,428,000  over the prior years six
month period. Amortization of the Master Service Agreement through September 30,
1999 totaled $1,567,188 ($0 in the prior year). Partially offsetting this is the
absence of  amortization  of goodwill  associated  with the now closed  Canadian
Operations totaling $100,000.

                                        1999        1998
                                        ----        ----
Loss on Master Service Agreement    $(13,321,093)   $ 0

This  represents the write off of the remaining net value assigned to the Master
Service  Agreement  purchased with DCI common stock in the last fiscal year. The
Company  never  received  the  favorable  carrier  rates it  expected or certain
switching equipment, and has suspended operations with the carrier.

                                       16


<PAGE>

                                          1999     1998
                                         -----     ------
Gain on Dissolution - Foreign
Subsidiary                          $1,446,399     $   0

A petition for issuance of an  Involuntary  Winding Up Order was issued  against
one of the Company's  subsidiaries  in Great Britain.  The gain is the result of
the  write  off of the  remaining  liabilities  exceeding  the  write off of the
remaining assets due to the large bad debt provision on March 31, 1999.

                                         1999       1998
                                        -----       ----
Investment Income                     $151,629     $42,933
Interest Expense                   ($1,414,890)   ($78,962)

The entire investment income of $ 151,629 in 1999 is the result of higher income
for Muller  Media which was included for six months in 1999 and only four months
in 1998.

The  increase in interest  expense of  $1,336,000  is the result of interest and
penalties associated with the inability of Series F Preferred holders to convert
to common shares and was converted to a note in November 1999.

                                           1999       1998
                                           ----       ----
Discontinued operations - CyberFax         $  0    ($232,852)
-----------------------

Since  CyberFax  was  sold on March  30,  1999 and  classified  as  discontinued
operations,  the $232,000 loss in 1998 June six months has been  reclassified as
discontinued operations.





                                       17
<PAGE>

                                     PART II

                           OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS.
          Not applicable.

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS.
          Not applicable.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES.
          Not applicable.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
          Not applicable.

ITEM 5.  OTHER INFORMATION.
          Not applicable.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.
          Page 19

                                  18


<PAGE>



ITEM 6 - Exhibits and Reports on Form 8K

1. Changes in  Registrant's  Certifying  Accountant as filed on Form 8K, Oct 11,
1999,  and as amended on Form 8K/A,  October 26,  1999,  and further  amended on
November 8, 1999

2. Changes in Registrant's  Certifying  Accountant as filed on form 8K, November
15, 1999.

                                   19


<PAGE>



                            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.

                                    DCI TELECOMMUNICATIONS, INC.

                                          (Registrant)

Dated: November 19, 1999            By: /s/Joseph J. Murphy
                                        -----------------------
                                        Joseph J. Murphy
                                        Chairman & CEO

                                        By: /s/Russell B. Hintz
                                        -----------------------
                                        Russell B. Hintz
                                        Chief Financial Officer

                                   20