Exhibit 99.1


                                  RISK FACTORS

An investment in the notes involves a high degree of risk. You should carefully
consider the risk factors set forth below, as well as other information
appearing elsewhere in this offering memorandum and the incorporated documents,
before making an investment in the notes.

RISKS RELATED TO OUR BUSINESS

WE HAVE SUBSTANTIAL EXISTING DEBT AND HAVE SIGNIFICANT INTEREST PAYMENT
REQUIREMENTS, WHICH COULD ADVERSELY AFFECT OUR ABILITY TO OBTAIN FINANCING IN
THE FUTURE AND REQUIRE OUR OPERATING SUBSIDIARIES TO APPLY A SUBSTANTIAL PORTION
OF THEIR CASH FLOW TO DEBT SERVICE.

We have now and after the closing of this offering will continue to have a
substantial amount of debt. As of June 30, 2005, after giving pro forma effect
to this offering, we would have had approximately $1,480.5 million of debt
outstanding reflected on our consolidated balance sheet (including approximately
$780.5 million of debt of our subsidiaries), and our subsidiaries would have had
approximately $548.1 million of unused credit commitments under the revolving
credit portion of the subsidiary credit facility.

On a pro forma basis, assuming that this offering and the application of the
proceeds therefrom had occurred at June 30, 2005, our ratio of earnings to fixed
charges would have been 1.02x for the six months ended June 30, 2005. The ratio
of earnings to fixed charges is often used by investors to evaluate a company's
capital structure and its ability to make payments on its debt.

Subject to restrictions in our subsidiary credit facility, the indenture
governing our 11% senior notes due 2013 (our "existing senior notes") and the
indenture governing the notes offered hereby, we may incur significant amounts
of additional debt for working capital, capital expenditures, acquisitions and
other purposes.

Our high level of combined debt could have important consequences for you,
including the following:

 -- Our ability to access new sources of financing for working capital, capital
    expenditures, acquisitions or other purposes may be limited;

 -- We will need to use a large portion of our revenues to pay interest on
    borrowings under our subsidiary credit facility, our existing senior notes
    and the notes, which will reduce the amount of money available to finance
    our operations, capital expenditures and other activities;

 -- Some of our debt has a variable rate of interest, which exposes us to the
    risk of increased interest rates;

 -- Borrowings under our subsidiary credit facility are secured and will mature
    prior to the notes;

 -- We may be more vulnerable to economic downturns and adverse developments in
    our business;

 -- We may be less flexible in responding to changing business and economic
    conditions, including increased competition and demand for new products and
    services;

 -- We may be at a disadvantage when compared to our competitors that have less
    debt; and

 -- We may not be able to implement our business strategy.



A DEFAULT UNDER THE INDENTURES GOVERNING OUR EXISTING SENIOR NOTES AND THE NOTES
OR UNDER OUR SUBSIDIARY CREDIT FACILITY COULD RESULT IN AN ACCELERATION OF OUR
INDEBTEDNESS AND OTHER MATERIAL ADVERSE EFFECTS.

The agreements and instruments governing our own and our subsidiaries'
indebtedness contain numerous financial and operating covenants. The breach of
any of these covenants could cause a default, which could result in the
indebtedness becoming immediately due and payable. If this were to occur, we
would be unable to adequately finance our operations. In addition, a default
could result in a default or acceleration of our other indebtedness subject to
cross-default provisions. If this occurs, we may not be able to pay our debts or
borrow sufficient funds to refinance them. Even if new financing is available,
it may not be on terms that are acceptable to us. The membership interests of
our operating subsidiaries are pledged as collateral under our subsidiary credit
facility. A default under our subsidiary credit facility could result in a
foreclosure by the lenders on the membership interests pledged under that
facility. Because we are dependent upon our operating subsidiaries for all of
our revenues, a foreclosure would have a material adverse effect on our
business, financial condition and results of operations.

WE HAVE A HISTORY OF NET LOSSES.

We have a history of net losses. Although we reported net income of $10.3
million and $22.9 million for the six months ended June 30, 2005 and 2004,
respectively, and net income of $34.9 million and $10.1 million for the years
ended December 31, 2004 and 2003, respectively, we reported net losses of $27.2
million and $50.6 million for the year ended December 31, 2002 and for the
period from April 5, 2001 (date of inception) through December 31, 2001,
respectively. The principal reasons for our prior net losses include the
depreciation and amortization expenses associated with our capital expenditures
related to expanding and upgrading our cable systems and interest costs on
borrowed money.

OUR SUBSIDIARY CREDIT FACILITY IMPOSES SIGNIFICANT RESTRICTIONS.

Our subsidiary credit facility contains covenants that restrict our
subsidiaries' ability to:

 -- distribute funds or pay dividends to us;

 -- incur additional indebtedness or issue additional equity;

 -- repurchase or redeem equity interests and indebtedness;

 -- pledge or sell assets or merge with another entity;

 -- create liens; and

 -- make certain capital expenditures, investments or acquisitions.

The ability of our subsidiaries to comply with these provisions may be affected
by events beyond our control. If they were to breach any of these covenants,
they would be in default under the credit facilities and they would be
prohibited from making distributions to us.

Under certain circumstances, lenders could elect to declare all amounts borrowed
under our subsidiary credit facility, together with accrued interest and other
fees, to be due and payable. If that occurred, our obligations under the
existing senior notes and the notes could also become payable immediately. Under
such circumstances, we may not be able to repay such amounts or the senior
notes.



THE TERMS OF OUR INDEBTEDNESS COULD MATERIALLY LIMIT OUR FINANCIAL AND OPERATING
FLEXIBILITY.

Several of the covenants contained in the agreements and instruments governing
our own and our subsidiaries' indebtedness could materially limit our financial
and operating flexibility by restricting, among other things, our ability and
the ability of our operating subsidiaries to:

 -- incur additional indebtedness;

 -- create liens and other encumbrances;

 -- pay dividends and make other payments, investments, loans and guarantees;

 -- enter into transactions with related parties;

 -- sell or otherwise dispose of assets and merge or consolidate with another
    entity;

 -- repurchase or redeem capital stock, other equity interests or debt;

 -- pledge assets; and

 -- issue capital stock or other equity interests.

Complying with these covenants could cause us to take actions that we otherwise
would not take or cause us not to take actions that we otherwise would take.

WE MAY NOT BE ABLE TO OBTAIN ADDITIONAL CAPITAL TO CONTINUE THE DEVELOPMENT OF
OUR BUSINESS.

We have invested substantial capital for the upgrade, expansion and maintenance
of our cable systems and the launch and expansion of new or additional products
and services. While we have substantially completed our planned system upgrades,
if there is accelerated growth in our video, HSD and voice products and
services, or we decide to introduce other new advanced products and services, or
the cost to provide these products and services increases, or we consummate one
or more acquisitions, we may need to make unplanned additional capital
expenditures. We may not be able to obtain the funds necessary to finance
additional capital requirements through internally generated funds, additional
borrowings or other sources. If we are unable to obtain these funds, we would
not be able to implement our business strategy and our results of operations
would be adversely affected.

IF WE ARE UNSUCCESSFUL IN IMPLEMENTING OUR GROWTH STRATEGY, OUR BUSINESS AND
RESULTS OF OPERATIONS COULD BE ADVERSELY AFFECTED.

We currently expect that a substantial portion of our future growth in revenues
will come from the expansion of relatively new services, the introduction of
additional new services, and, possibly, acquisitions. Relatively new services
include HSD, VOD, DVRs and HDTV. In the second quarter of 2005, we began to
offer cable telephony service to subscribers in certain markets and we expect to
have 1.1 million homes telephony-ready by the end of 2005. We may not be able to
successfully expand existing services due to unpredictable technical,
operational or regulatory challenges. It is also possible that these services
will not generate significant revenue growth.

THE ACQUISITION AND INTEGRATION OF ADDITIONAL CABLE SYSTEMS COULD ADVERSELY
AFFECT OUR BUSINESS AND RESULTS OF OPERATIONS.

From time to time we evaluate opportunities to acquire additional cable systems.
If we make acquisitions in the future, we may need to incur more debt and we may
incur contingent liabilities and amortization expenses, which could adversely
affect our operating results and


financial condition. If we make acquisitions in the future and the expected
operating efficiencies do not materialize, or if we fail to effectively
integrate acquired cable systems into our existing business, or if the costs of
such integration exceed expectations, our operating results and financial
condition could be adversely affected.

OUR PROGRAMMING COSTS ARE INCREASING, AND OUR BUSINESS AND RESULTS OF OPERATIONS
WILL BE ADVERSELY AFFECTED IF WE CANNOT PASS THROUGH A SUFFICIENT PART OF THE
ADDITIONAL COSTS TO SUBSCRIBERS.

Our programming costs have been, and are expected to continue to be, one of our
largest single expense items. In recent years, the cable and satellite video
industries have experienced a rapid increase in the cost of programming,
particularly sports programming. This increase in programming costs is expected
to continue, and we may not be able to pass on all programming cost increases to
our customers. In addition, as we add programming to our basic and expanded
basic programming tiers, we may not be able to pass on all of our costs of the
additional programming to our customers without the potential loss of basic
subscribers. To the extent that we may not be able to pass on increased or
additional programming costs, particularly sports programming, to subscribers,
our business and results of operations will be adversely affected.

We also expect to be subject to increasing financial and other demands by
broadcasters to obtain the required consents for the transmission of broadcast
programming to our subscribers. We cannot predict the impact of these
negotiations on our business and results of operations or the effect on our
subscribers should we be required to suspend the carriage of this programming.

WE OPERATE IN A HIGHLY COMPETITIVE BUSINESS ENVIRONMENT, WHICH AFFECTS OUR
ABILITY TO ATTRACT AND RETAIN CUSTOMERS AND CAN ADVERSELY AFFECT OUR BUSINESS
AND OPERATIONS. WE HAVE LOST A SIGNIFICANT NUMBER OF CUSTOMERS TO DIRECT
BROADCAST SATELLITE COMPETITION, AND FURTHER LOSS OF CUSTOMERS COULD HAVE A
MATERIAL NEGATIVE IMPACT ON OUR BUSINESS.

The industry in which we operate is highly competitive and is often subject to
rapid and significant changes and developments in the marketplace and in the
regulatory and legislative environment. In some instances, we compete against
companies with fewer regulatory burdens, easier access to financing, greater
resources and operating capabilities, greater brand name recognition and
long-standing relationships with regulatory authorities and customers.

Our video business faces competition primarily from DBS service providers. Our
principal competitor in the HSD business, in markets where it is available, is
telephone service, or DSL. The two largest DBS companies, DIRECTV, Inc. and
EchoStar Communications, are each among the four largest providers of
multichannel video programming services based on reported customers. In
addition, DIRECTV's affiliation with News Corporation could strengthen that
company's competitive positioning, as News Corporation also owns Fox Television
Network and several cable programming services. Competition from DBS has had an
adverse effect on our ability to retain customers. DBS has grown rapidly over
the past several years and continues to do so. We have lost a significant number
of customers to DBS competition, and will continue to face significant
challenges from DBS providers.

Local telephone companies are capable of offering video and other services in
competition with us and they may increasingly do so in the future. Certain
telephone companies have begun to deploy fiber more extensively in their
networks and some have announced plans to



deploy broadband services, including video programming services, in a manner
which avoids the same regulatory burdens imposed on our business. These
deployments will enable them to begin providing video services, as well as
telephone and Internet access services, to residential and business customers.
New laws or regulations at the federal or state level may clarify the ability of
the local telephone companies to provide their services without obtaining state
or local cable franchises. If local telephone companies are not required to
obtain local cable franchises comparable to ours, it would be adverse to our
business.

We also face growing competition from municipal entities that construct
facilities and provide cable television, HSD, telephony and/or other related
services. In addition to hard-wired facilities, some municipal entities are
exploring building wireless fidelity networks to deliver these services. In
Iowa, our largest market, an organization named Opportunity Iowa, is actively
encouraging Iowa municipalities to construct facilities that could be used to
provide services that compete with the services we offer.

We also face competition from over-the-air television and radio broadcasters and
from other communications and entertainment media such as movie theaters, live
entertainment and sports events, newspapers and home video products. Further
losses of customers to DBS or other alternative video and HSD services could
also have a material adverse effect on our business.

In our HSD business, we face competition primarily from telephone companies and
other providers of "dial-up" and DSL. DSL service is competitive with HSD
service over cable systems. Telephone companies (which already have telephone
lines into the household, an existing customer base and other operational
functions in place) and other companies offer DSL service. In addition, certain
DBS providers are currently offering two-way broadband data access services,
which compete with our ability to offer bundled services to our customers.

Our HSD business may also face competition in the future from registered utility
holding companies and subsidiaries. In 2004, the FCC adopted rules: (i) that
affirmed the ability of electric service providers to provide broadband Internet
access services over their distribution systems; and (ii) that seek to avoid
interference with existing services. Electric utilities could be formidable
competitors to us.

Some of our competitors, including franchised, wireless or private cable
operators, satellite television providers and local exchange carriers, may
benefit from permanent or temporary business combinations such as mergers, joint
ventures and alliances and the potential repeal of certain ownership rules,
either through access to financing, resources or efficiencies of scale, or the
ability to provide multiple services in direct competition with us. Some of our
present or future competitors may have greater financial resources or, through
their affiliates, greater access to programming or other services, than we do.

IF WE ARE UNABLE TO KEEP PACE WITH TECHNOLOGICAL CHANGE, OUR BUSINESS AND
RESULTS OF OPERATIONS COULD BE ADVERSELY AFFECTED.

Our industry is characterized by rapid technological change and the introduction
of new products and services. We cannot assure you that we will be able to fund
the capital expenditures necessary to keep pace with future technological
developments. We also cannot assure you that we will successfully anticipate the
demand of our customers for products and services requiring new technology. This
type of rapid technological change could adversely affect our ability to
maintain, expand or upgrade our systems and respond to competitive pressures. An
inability to maintain and expand our systems and provide advanced services in a



timely manner, or to anticipate the demands of the market place, could adversely
affect our ability to compete and our results of operations.

THE LOSS OF KEY PERSONNEL COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR BUSINESS.

If any of our manager's key personnel ceases to participate in our business and
operations, our profitability could suffer. Our success is substantially
dependent upon the retention of, and the continued performance by, our manager's
key personnel, including Rocco B. Commisso, the Chairman and Chief Executive
Officer of our manager. Our manager has not entered into a long-term employment
agreement with Mr. Commisso. Neither our manager nor we currently maintain key
man life insurance on Mr. Commisso or other key personnel.

WE MAY NOT BE ABLE TO OBTAIN CRITICAL ITEMS AT A REASONABLE COST OR WHEN
REQUIRED, WHICH COULD ADVERSELY AFFECT BUSINESS, FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.

We depend on third-party suppliers for equipment, software, services and other
items that are critical for the operation of our cable systems and the provision
of advanced services, including digital set-top converter boxes, digital video
recorders and routers, fiber-optic cable, telephone circuits, software, the
"backbone" telecommunications network for our high-speed data service and
construction services for expansion and upgrades of our cable systems. These
items are available from a limited number of suppliers. Demand for these items
has increased with the general growth in demand for Internet and
telecommunications services. We typically do not carry significant inventories
of equipment. Moreover, if there are no suppliers that are able to provide
set-top converter boxes that comply with evolving Internet and
telecommunications standards or that are compatible with other equipment and
software that we use, our business, financial condition and results of
operations could be materially adversely affected. If we are unable to obtain
critical equipment, software, services or other items on a timely basis and at
an acceptable cost, our ability to offer our products and services and roll out
advanced services may be impaired, and our business, financial condition and
results of operations could be materially adversely affected.

WE RELY ON OUR PARENT AND AFFILIATE COMPANIES FOR VARIOUS SERVICES AND JOINT
ENDEAVORS.

We rely on our parent, Mediacom Communications, for various services such as
corporate and administrative support. In addition, as permitted by the indenture
governing the notes, we enter into many types of transactions with Mediacom
Communications or its subsidiaries, such as Mediacom LLC, the primary purpose of
which is to result in cost savings and related synergies. These transactions
relate to, among other things:

- the sharing of centralized services, personnel, facilities, headends and
  plant;

- the joint procurement of goods and services;

- the allocation of certain costs and expenses; and

- other matters reasonably related to the foregoing.

Our financial position, results of operations and cash flows could differ from
those that would have resulted had Mediacom Broadband operated autonomously or
as an entity independent of Mediacom Communications. Similarly, our financial
position, results of operations and cash flows would be impacted if, for any
reason, transactions such as those described above were unavailable to us or if
we were required to fulfill any jointly contracted obligations that an affiliate
outside of our control failed to perform. We are unable to predict or quantify
the



impact of any changes that would result if joint transactions such as those
described above were unavailable to us.

RISKS RELATED TO LEGISLATIVE AND REGULATORY MATTERS

OUR CABLE TELEVISION BUSINESS IS SUBJECT TO EXTENSIVE GOVERNMENTAL REGULATION.

The cable television industry is subject to extensive legislation and regulation
at the federal and local levels, and, in some instances, at the state level.
Many aspects of such regulation are currently the subject of judicial and
administrative proceedings and legislative and administrative proposals, and
lobbying efforts by us and our competitors. We expect that court actions and
regulatory proceedings will continue to refine our rights and obligations under
applicable federal, state and local laws. The results of these judicial and
administrative proceedings and legislative activities may materially affect our
business operations. Local authorities grant us non-exclusive franchises that
permit us to operate our cable systems. We renew or renegotiate these franchises
from time to time. Local franchising authorities may demand concessions, or
other commitments, as a condition to renewal, and these concessions or other
commitments could be costly. The Communications Act contains renewal procedures
and criteria designed to protect incumbent franchisees against arbitrary denials
of renewal, and although such Act requires the local franchising authorities to
take into account the costs of meeting such concessions or commitments, there is
no assurance that we will not be compelled to meet their demands in order to
obtain renewals. We cannot predict whether any of the markets in which we
operate will expand the regulation of our cable systems in the future or the
impact that any such expanded regulation may have upon our business.

Similarly, due to the increasing popularity and use of commercial online
services and the Internet, certain aspects have become subject to regulation at
the federal and state level such as collection of information online from
children, disclosure of certain subscriber information to governmental agencies,
commercial emails or "spam," privacy, security and distribution of material in
violation of copyrights. In addition to the possibility that additional federal
laws and regulations may be adopted with respect to commercial online services
and the Internet, several individual states have imposed such restrictions and
others may also impose similar restrictions, potentially creating an intricate
patchwork of laws and regulations. Future federal and/or state laws may cover
such issues as privacy, access to some types of content by minors, pricing,
encryption standards, consumer protection, electronic commerce, taxation of
e-commerce, copyright infringement and other intellectual property matters. The
adoption of such laws or regulations in the future may decrease the growth of
such services and the Internet, which could in turn decrease the demand for our
cable modem service, increase our costs of providing such service or have other
adverse effects on our business, financial condition and results of operations.
Such laws or regulations may also require disclosure of failures of our
procedures or breaches to our system by third parties, which can increase the
likelihood of claims against us by affected subscribers.

CHANGES IN CHANNEL CARRIAGE REGULATIONS COULD IMPOSE SIGNIFICANT ADDITIONAL
COSTS ON US.

Cable operators face significant regulation of their channel carriage.
Currently, they can be required to devote substantial capacity to the carriage
of programming that they might not carry voluntarily, including certain local
broadcast signals, local public, educational and government access programming,
and unaffiliated commercial leased access programming. If the FCC or Congress
were to require cable systems to carry both the analog and digital versions of
local broadcast signals or to carry multiple program streams included with a
single digital


broadcast transmission, this carriage burden would increase substantially.
Recently, the FCC reaffirmed that cable operators need only carry one
programming service of each television broadcaster to fulfill its must-carry
obligation, however, changes in the composition of the Commission as well as
proposals currently under consideration could result in an obligation to carry
both the analog and digital version of local broadcast stations and/or to carry
multiple digital program streams. Further, this decision has been appealed to
the D.C. Circuit Court of Appeals.

Recently, the FCC imposed "reciprocal" good faith retransmission consent
negotiation obligations on cable operators. These rules identify seven types of
conduct that would constitute "per se" violations of the new requirements. Thus,
even though we may have no interest in carrying a particular broadcaster's
programming, we may be required under the new rules to engage in negotiations
within the parameters of the FCC's rules. The impact of these rules on our
business cannot be determined at this time. While noting that the parties in
retransmission consent negotiations were now subject to a "heightened duty of
negotiation," the FCC emphasized that failure to ultimately reach an agreement
is not a violation of the rules. Broadcasters must submit their elections to
cable operators to be classified as either a "must-carry" or a "retransmission
consent" signal for the period January 1, 2006 through December 31, 2008 by
October 1, 2005.

OUR FRANCHISES ARE NON-EXCLUSIVE AND LOCAL FRANCHISING AUTHORITIES MAY GRANT
COMPETING FRANCHISES IN OUR MARKETS.

Our cable systems are operated under non-exclusive franchises granted by local
franchising authorities. As a result, competing operators of cable systems and
other potential competitors, such as municipal utility providers, may be granted
franchises and may build cable systems in markets where we hold franchises. Some
may not require local franchises at all, such as certain municipal utility
providers. Any such competition could adversely affect our business. The
existence of multiple cable systems in the same geographic area is generally
referred to as an "overbuild." As of March 31, 2005, approximately 15.8% of the
estimated homes passed by our cable systems were overbuilt by other cable
operators. We cannot assure you that competition from overbuilders will not
develop in other markets that we now serve or will serve after any future
acquisitions.

Legislation recently passed in one state (in which we do not currently operate
cable systems) and similar legislation is pending or has been proposed in
certain other states and in Congress that would allow local telephone companies
to deliver services would compete with our cable service without obtaining
equivalent local franchises. Such a legislatively granted advantage to our
competitors could adversely affect our business. The effect of such initiatives,
if any, on our obligation to obtain local franchises in the future or on any of
our existing franchises, many of which have years remaining in their terms,
cannot be predicted.

PENDING FCC AND COURT PROCEEDINGS COULD ADVERSELY AFFECT OUR HSD SERVICE.

The legal and regulatory status of providing high-speed Internet access service
by cable television companies is uncertain. Although the United States Supreme
Court recently held that cable modem service was properly classified by the FCC
as an "information service," freeing it from regulation as a "telecommunications
service," it recognized that the FCC has jurisdiction to impose regulatory
obligations on facilities based Internet Service Providers. The FCC has an
ongoing rulemaking to determine whether to impose regulatory obligations on such
providers, including us. The FCC has issued a declaratory ruling that cable
modem service, as it is currently



offered, is properly classified as an interstate information service that is not
subject to common carrier regulation. However, the FCC is still considering the
following: whether to require cable companies to provide capacity on their
systems to other entities to deliver high-speed Internet directly to customers,
also known as open access; whether certain other regulatory requirements do or
should apply to cable modem service; and whether and to what extent cable modem
service should be subject to local franchise authorities' regulatory
requirements or franchise fees. The adoption of new rules by the FCC could place
additional costs and regulatory burdens on us, reduce our anticipated revenues
or increase our anticipated costs for this service, complicate the franchise
renewal process, result in greater competition or otherwise adversely affect our
business. While we cannot predict the outcome of this proceeding, we do note
that the FCC recently removed the requirement that telecommunications carriers
provide access to competitors to resell their DSL Internet access service citing
the need for competitive parity with cable modem service which has no similar
access requirement.

WE MAY BE SUBJECT TO LEGAL LIABILITY BECAUSE OF THE ACTS OF OUR HSD CUSTOMERS OR
BECAUSE OF OUR OWN NEGLIGENCE.

Our HSD service enables individuals to access the Internet and to exchange
information, generate content, conduct business and engage in various online
activities on an international basis. The law relating to the liability of
providers of these online services for activities of their users is currently
unsettled both within the United States and abroad. Potentially, third parties
could seek to hold us liable for the actions and omissions of our cable modem
service customers, such as defamation, negligence, copyright or trademark
infringement, fraud or other theories based on the nature and content of
information that our customers use our service to post, download or distribute.
We also could be subject to similar claims based on the content of other
Websites to which we provide links or third-party products, services or content
that we may offer through our Internet service. Due to the global nature of the
Web, it is possible that the governments of other states and foreign countries
might attempt to regulate its transmissions or prosecute us for violations of
their laws.

It is also possible that information provided directly by us will contain errors
or otherwise be negligently provided to users, resulting in third parties making
claims against us. For example, we offer Web-based email services, which expose
us to potential risks, such as liabilities or claims resulting from unsolicited
email, lost or misdirected messages, illegal or fraudulent use of email, or
interruptions or delays in email service. Additionally, we host website "portal
pages" designed for use as a home page by, but not limited to, our HSD
customers. These portal pages offer a wide variety of content from us and third
parties which could contain errors or other material that could give rise to
liability.

To date, we have not been served notice that such a claim has been filed against
us. However, in the future someone may serve such a claim on us in either a
domestic or international jurisdiction and may succeed in imposing liability on
us. Our defense of any such actions could be costly and involve significant
distraction of our management and other resources. If we are held or threatened
with significant liability, we may decide to take actions to reduce our exposure
to this type of liability. This may require us to spend significant amounts of
money for new equipment and may also require us to discontinue offering some
features or our cable modem service.

Since we launched our proprietary Mediacom Online(SM) HSD service in February
2002, from time to time, we receive notices of claimed infringements by our
cable modem service users. The owners of copyrights and trademarks have been
increasingly active in seeking to prevent use of


the Internet to violate their rights. In many cases, their claims of
infringement are based on the acts of customers of an Internet service
provider-for example, a customer's use of an Internet service or the resources
it provides to post, download or disseminate copyrighted music, movies, software
or other content without the consent of the copyright owner or to seek to profit
from the use of the goodwill associated with another person's trademark. In some
cases, copyright and trademark owners have sought to recover damages from the
Internet service provider, as well as or instead of the customer. The law
relating to the potential liability of Internet service providers in these
circumstances is unsettled. In 1996, Congress adopted the Digital Millennium
Copyright Act, which is intended to grant ISPs protection against certain claims
of copyright infringement resulting from the actions of customers, provided that
the ISP complies with certain requirements. So far, Congress has not adopted
similar protections for trademark infringement claims.

WE MAY BE REQUIRED TO PROVIDE ACCESS TO OUR NETWORKS TO OTHER INTERNET SERVICE
PROVIDERS, WHICH COULD SIGNIFICANTLY INCREASE OUR COMPETITION AND ADVERSELY
AFFECT OUR ABILITY TO PROVIDE NEW PRODUCTS AND SERVICES.

Local authorities and the FCC have been asked to require cable operators to
provide non-discriminatory access over their cable systems to other Internet
service providers. The recent decision by the United State Supreme Court
upholding the FCC's classification of cable modem service as an "information
service" may effectively forestall efforts by competitors to obtain access to
the networks of cable operators to provide Internet access services. As noted
above, however, the FCC continues to have jurisdiction over this issue and a
rulemaking initiated prior to the Supreme Court's decision remains ongoing.
While we cannot predict the outcome of this proceeding, we do note that the FCC
recently removed the requirement that telecommunications carriers provide access
to competitors to resell their DSL internet access service citing the need for
competitive parity with cable modem service which has no similar access
requirement. If we are required to provide access in this manner, it could have
a significant adverse impact on our financial results, including by: (i)
increasing competition; (ii) increasing the expenses we incur to maintain our
systems; and/or (iii) increasing the expense of upgrading and/or expanding our
systems.

WE MAY BECOME SUBJECT TO ADDITIONAL REGULATORY BURDENS BECAUSE WE OFFER CABLE
TELEPHONY SERVICE.

The regulatory treatment of VoIP services like those we and others offer is
uncertain. The FCC, Congress, and the states are continuing to look at issues
surrounding the provision of VoIP and some of those issues are also before
federal courts. We cannot predict how these issues will be resolved, but any
determination that results in greater or different regulatory obligations could
result in increased costs, reduce anticipated revenues, impede our ability to
effectively compete or otherwise adversely affect our ability to successfully
roll-out and conduct our telephony business.

ACTIONS BY POLE OWNERS MIGHT SUBJECT US TO SIGNIFICANTLY INCREASED POLE
ATTACHMENT COSTS.

Our cable facilities are often attached to or use public utility poles, ducts or
conduits. Historically, cable system attachments to public utility poles have
been regulated at the federal or state level. Generally this regulation resulted
in favorable pole attachment rates for attachments used to provide cable
service. The FCC clarified that the provision of Internet access does not
endanger a cable operator's favorable pole rates; this approach ultimately was



upheld by the Supreme Court of the United States. That ruling, coupled with the
recent Supreme Court decision upholding the FCC's classification of cable modem
service as an information service, should strengthen our ability to resist such
rate increases based solely on the delivery of cable modem services over our
cable systems. As we continue our deployment of cable telephony and certain
other advanced services, utilities may continue to invoke higher rates. Our
financial results could suffer a material adverse impact from any significant
increased costs, and such increased pole attachment costs could discourage
system upgrades and the introduction of new products and services.

CHANGES IN COMPULSORY COPYRIGHT REGULATIONS MIGHT SIGNIFICANTLY INCREASE OUR
LICENSE FEES.

Two recently filed petitions for rulemaking with the United States Copyright
Office propose revisions to certain compulsory copyright license reporting
requirements and seek clarification of certain issues relating to the
application of the compulsory license to the carriage of digital broadcast
stations. The petitions seek, among other things: (1) clarification of the
inclusion in gross revenues of digital converter fees, additional set fees for
digital service and revenue from required "buy throughs" to obtain digital
service; (2) reporting of "dual carriage" and multicast signals; and (3)
revisions to the Copyright Office's rules and Statement of Account forms,
including increased detail regarding services, rates and subscribers, additional
information regarding non-broadcast tiers of service, cable headend location
information, community definition clarification and identification of the county
in which the cable community is located and the effect of interest payments on
potential liability for late filing. We understand that the Copyright Office
intends to open one or more rulemakings in response to these petitions. We
cannot predict the outcome of such rulemakings, however, it is possible that
certain changes in the rules or copyright compulsory license fee computations
could have an adverse affect on our business by increasing our copyright
compulsory license fee costs or by causing us to reduce or discontinue carriage
of certain broadcast signals that we currently carry on a discretionary basis.

RISKS RELATED TO THE NOTES

WE AND OUR SUBSIDIARIES MAY STILL BE ABLE TO INCUR SUBSTANTIALLY MORE DEBT WHICH
COULD EXACERBATE THE RISKS DESCRIBED ABOVE

We and our subsidiaries may be able to incur substantial additional debt in the
future. If we or our subsidiaries do so, the risks described above could
intensify. The terms of the indenture governing the existing senior notes do
not, and the terms of the indenture governing the notes will not, fully prohibit
us or our subsidiaries from doing so. As of June 30, 2005, as adjusted to give
effect to this offering and the application of the proceeds therefrom, we would
have had approximately $548.1 million available (subject to certain borrowing
conditions) for additional borrowings under our subsidiary credit facility. We
expect to continue to borrow under this facility.

THE NOTES WILL BE EFFECTIVELY SUBORDINATED TO ALL DEBT AND OTHER LIABILITIES OF
OUR SUBSIDIARIES.

Mediacom Broadband LLC is a holding company. As a result, the notes are
effectively subordinated to all existing and future liabilities of our
subsidiaries, including debt under our subsidiary credit facility. If the
maturity of the loans under our subsidiary credit facility were accelerated, our
subsidiaries would have to repay all debt outstanding under that credit facility
before they could distribute any assets or cash to us. Remedies to the lenders
under our




subsidiary credit facility could constitute events of default under the
indenture governing the notes. If these remedies were exercised, the maturity of
the notes could be accelerated, and our subsidiaries' obligations under our
subsidiary credit facility could be accelerated also. In such circumstances,
there can be no assurance that our subsidiaries' assets would be sufficient to
repay all of their debt and then to make distributions to us to enable us to
meet our obligations under the indenture. Claims of creditors of our
subsidiaries, including general trade creditors, will generally have priority
over holders of the notes as to the assets of our subsidiaries. Additionally,
any right we may have to receive assets of any of our subsidiaries upon such
subsidiary's liquidation or reorganization will be effectively subordinated to
the claims of the subsidiary's creditors, except to the extent, if any, that we
ourselves are recognized as a creditor of such subsidiary, in which case our
claims would still be subordinate to the claims of such creditors who hold
security in the assets of such subsidiary to the extent of such assets and to
the claims of such creditors who hold indebtedness of such subsidiary senior to
that held by us. As of June 30, 2005, as adjusted to give effect to this
offering, the aggregate amount of the debt and other liabilities of our
subsidiaries reflected on our consolidated balance sheet as to which holders of
the notes would have been effectively subordinated was approximately $780.5
million and our subsidiaries would have had approximately $548.1 million of
unused credit commitments under the revolving credit portion of our subsidiary
credit facility. Our subsidiaries may incur additional debt or other obligations
in the future and the notes will be effectively subordinated to such debt or
other obligations.

THE NOTES ARE OBLIGATIONS OF A HOLDING COMPANY WHICH HAS NO OPERATIONS AND
DEPENDS ON ITS SUBSIDIARIES FOR CASH

As a holding company, we will not hold any assets other than our investments in
and our advances to our operating subsidiaries. Consequently, our subsidiaries
conduct all of our consolidated operations and own substantially all of our
consolidated assets. Our only source of the cash we need to pay current interest
on the notes and our other obligations and to repay the principal amount of
these obligations, including the notes, is the cash that our subsidiaries
generate from their operations and their borrowings. Our subsidiaries are not
obligated to make funds available to us.

Our subsidiaries' ability to make payments to us will depend upon their
operating results and will be subject to applicable laws and contractual
restrictions. Our subsidiary credit facility permits our subsidiaries to
distribute cash to us to pay interest on the notes, but only so long as there is
no default under such credit facility. If there is a default under our
subsidiary credit facility, we would not have any cash to pay interest on our
obligations, including the notes.

OUR OWNERSHIP INTERESTS IN OUR SUBSIDIARIES ARE PLEDGED AS COLLATERAL UNDER OUR
SUBSIDIARY CREDIT FACILITY AND MAY NOT BE AVAILABLE TO HOLDERS OF THE NOTES.

All of our ownership interests in our subsidiaries are pledged as collateral
under our subsidiary credit facility. Therefore, if we were unable to pay
principal or interest on the notes, the ability of the holders of the notes to
proceed against the ownership interests in our subsidiaries to satisfy such
amounts would be subject to the prior satisfaction in full of all amounts owing
under our subsidiary credit facility. Any action to proceed against such
interests by or on behalf of the holders of notes would constitute an event of
default under our subsidiary credit facility entitling the lenders thereunder to
declare all amounts owing thereunder to be immediately due and payable. In
addition, as secured creditors, the lenders under our subsidiary credit




facility would control the disposition and sale of our subsidiaries' interests
after an event of default under our subsidiary credit facility and would not be
legally required to take into account the interests of our unsecured creditors,
such as the holders of the notes, with respect to any such disposition or sale.
There can be no assurance that our assets after the satisfaction of claims of
our secured creditors would be sufficient to satisfy any amounts owing with
respect the notes.

WE MAY NOT BE ABLE TO GENERATE ENOUGH CASH TO SERVICE OUR DEBT

Our ability to make payments on and to refinance our debt, including the notes,
and to fund planned capital expenditures will depend on our ability to generate
cash. This is subject, in part, to general economic, financial, competitive,
legislative, regulatory and other factors that are beyond our control.
Accordingly, we cannot assure you that our business will generate sufficient
cash flows from operations or that future distributions will be available to us
in amounts sufficient to enable us to pay our indebtedness, including the notes,
or to fund our other liquidity needs.

We may need to refinance all or a portion of our indebtedness, including the
notes, on or before maturity. We cannot assure you that we will be able to
refinance any of our indebtedness on commercially reasonable terms or at all.

UNDER CERTAIN CIRCUMSTANCES, FEDERAL AND STATE LAWS MAY ALLOW COURTS TO VOID OR
SUBORDINATE CLAIMS WITH RESPECT TO THE NOTES OR TO MODIFY THE CONTRACTUAL OR
STRUCTURAL RELATIONSHIP BETWEEN DIFFERENT CLASSES OF CREDITORS.

Under the federal Bankruptcy Code and comparable provisions of state fraudulent
transfer laws, a court could void claims with respect to the notes, or
subordinate them, if, among other things, we, at the time the notes were issued:

 -- received less than reasonably equivalent value or fair consideration for the
    notes; and

 -- was insolvent or rendered insolvent by reason of the incurrence;

 -- was engaged in a business or transaction for which its remaining assets
    constituted unreasonably small capital; or

 -- intended to incur, or believed that it would incur, debts beyond its ability
    to pay such debts as they became due.

The measures of insolvency for purposes of these fraudulent or preferential
transfer laws vary depending upon the law applied in any proceeding to determine
whether a fraudulent or preferential transfer has occurred. Generally, however,
we would be considered insolvent if:

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

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

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




Based upon information currently available to us, we believe that the notes are
being incurred for proper purposes and in good faith.

In addition, if there were to be a bankruptcy of our parent and/or its
subsidiaries, creditors of our parent may attempt to make claims against us and
our subsidiaries, including seeking substantive consolidation of our and our
subsidiaries' assets and liabilities with the liabilities of our parent, which
(if successful) could have an adverse effect on holders of the notes and their
recoveries in any bankruptcy proceeding.

OUR ABILITY TO PURCHASE YOUR NOTES ON A CHANGE OF CONTROL MAY BE LIMITED.

If we undergo a change of control, we may need to refinance large amounts of our
debt, including our subsidiary credit facility, and we must offer to buy back
the notes for a price equal to 101% of their principal amount, plus accrued and
unpaid interest to the repurchase date. We cannot assure you that we will have
sufficient funds available to make the required repurchases of the notes in that
event, or that we will have sufficient funds to pay our other debts.

In addition, our subsidiary credit facility prohibits our subsidiaries from
providing us with funds to finance a change of control offer after a change of
control until our subsidiaries have repaid in full their debt under our
subsidiary credit facility. If we fail to repurchase the notes upon a change of
control, we will be in default under the indenture governing the notes and the
indenture governing our existing senior notes. Any future debt that we incur may
also contain restrictions on repurchases in the event of a change of control or
similar event. These repurchase requirements may delay or make it harder to
obtain control of our company.

The change of control provisions may not protect you in a transaction in which
we incur a large amount of debt, including a reorganization, restructuring,
merger or other similar transaction, because that kind of transaction may not
involve any shift in voting power or beneficial ownership, or may not involve a
shift large enough to trigger a change of control.

YOU SHOULD NOT EXPECT MEDIACOM BROADBAND CORPORATION TO PARTICIPATE IN MAKING
PAYMENTS ON THE NOTES.

Mediacom Broadband Corporation is a wholly-owned subsidiary of Mediacom
Broadband LLC that was incorporated to accommodate the issuance of the existing
senior notes by Mediacom Broadband LLC. Mediacom Broadband Corporation has no
operations, revenues or cash flows and has no assets, liabilities or
stockholders' equity on its balance sheet, other than a one-hundred dollar
receivable from an affiliate and the same dollar amount of common stock on its
consolidated balance sheets. You should not expect Mediacom Broadband
Corporation to participate in servicing the interest or principal obligations on
the notes.

THE CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF OUR MANAGER HAS THE ABILITY TO
CONTROL ALL MAJOR CORPORATE DECISIONS, WHICH COULD INHIBIT OR PREVENT A CHANGE
OF CONTROL OR CHANGE IN MANAGEMENT.

We are a wholly-owned subsidiary of our manager, Mediacom Communications. Rocco
B. Commisso, Mediacom Communications' Chairman and Chief Executive Officer,
controls approximately 76.1% of the combined voting power of Mediacom
Communications' common stock. As a result, Mr. Commisso will generally have the
ability to control the outcome of all matters




requiring stockholder approval, including the election of its entire board of
directors, the approval of any merger or consolidation and the sale of all or
substantially all of its assets.

AN ACTIVE LIQUID TRADING MARKET FOR THE NOTES MAY NOT DEVELOP.

Prior to this offering, there has been no public market for the notes. The notes
are a new class of securities which have never been traded. We have applied to
have the notes designated as eligible for trading in The PORTAL Market. However,
we cannot assure you that the notes will be so designated for trading in The
PORTAL Market at the time the notes are delivered to purchasers or at any other
time. Each of the initial purchasers has informed us that it intends to make a
market in the notes. However, none of them are obligated to do so, and any or
all of them may discontinue such market making at any time without notice.
Moreover, the initial purchasers' market making activities will be subject to
limits imposed by the Securities Act or the Securities Exchange Act of 1934
during the pendency of any exchange offer described under "Exchange Offer and
Registration Rights Agreement." There can be no assurance that an active trading
market for the notes will develop, or if one does develop, that it will be
sustained.

Historically, the market for non-investment grade debt has been highly volatile
in terms of price. It is possible that the market for the notes and the exchange
notes will also be volatile. This volatility in price may affect your ability to
resell your notes or exchange notes or the timing of their sale.

THERE ARE RESTRICTIONS ON RESALE OF THE NOTES.

The notes have not been registered under the Securities Act or any state
securities laws, and may not be offered or sold except pursuant to an exemption
from the registration requirements of the Securities Act and applicable state
securities laws, or pursuant to an effective registration statement. We have
agreed to commence a registered exchange offer for the notes or to register
resales of the notes under the Securities Act, but no assurances can be given
that such a registration will be completed or that any trading market will
develop thereafter. See "Description of the Notes," "Exchange Offer and
Registration Rights Agreement" and "Notice to Investors."




                                    BUSINESS

The section entitled "Business--Competition" in Part I, Item I of the 2004
Annual Report is updated by adding as a new second paragraph thereof the
following:

We also face growing competition from municipal entities that construct
facilities and provide cable television, HSD, telephony and/or other related
services. In addition to hard-wired facilities, some municipal entities are
exploring building wireless fidelity networks to deliver these services. In
Iowa, our largest market, an organization named Opportunity Iowa, is actively
encouraging Iowa municipalities to construct facilities that could be used to
provide services that compete with the services we offer.

The section entitled "Business--Competition--Telephone Companies" in Part I,
Item I of the 2004 Annual Report is updated and modified in its entirety with
the following:

TELEPHONE COMPANIES

The 1996 Telecom Act eliminated many restrictions on the ability of local
telephone companies to offer video programming. In addition to their
joint-marketing alliances with DBS service providers, certain local telephone
companies have recently announced that they are now constructing new fiber
networks to replace their existing networks, which will enhance their ability to
offer video services in addition to improved voice and high speed data services.
If these and other telephone companies decide to rebuild their networks in our
markets and offer video services they will compete with us and other video
providers, which includes DBS service providers.

Local telephone companies may have a number of different ways to enter the video
programming business, some of which do not require obtaining a local franchise.
Local telephone companies and other potential competitors have the ability to
certify their competing video service as an "open video" system. Open video
system operators are not subject to certain requirements imposed by the 1984
Cable Act upon more traditional cable operators. Legislation recently passed in
one state (in which we do not currently operate cable systems) and similar
legislation is pending or has been proposed in certain other states and in
Congress that could allow local telephone companies to deliver services that
would compete with our cable service without obtaining equivalent local
franchises.

The section entitled "Business--Competition--High Speed Data" in Part I, Item I
of the 2004 Annual Report is updated and modified in its entirety with the
following:

HIGH SPEED DATA

We offer HSD, or cable modem service, in many of our cable systems. Our cable
modem service competes mainly with the high-speed Internet access services
offered by local and long distance telephone companies. These competitors have
substantial resources.

DSL services offered by telephone companies provide Internet access at data
transmission speeds greater than that of standard telephone line or "dial-up"
modems, putting DSL service in direct competition with our cable modem service.
Telephone companies that have made the necessary plant investment have
introduced DSL services in many of our markets, however, we believe their
serviceable areas currently do not match our network reach in those markets. The
FCC has an ongoing rulemaking proceeding that may materially reduce existing
regulation of DSL service, essentially freeing such service from traditional
telecommunications regulation.




Federal legislation or judicial decisions may also reduce regulation of Internet
services offered by incumbent telephone companies.

As discussed above, certain major telephone companies are currently constructing
new fiber networks. These companies have indicated that this will create a new
platform that will allow them to offer significantly faster high-speed data
services compared to the offerings available under current DSL technology.

DBS service providers are currently offering two alternatives of
satellite-delivered high-speed data. The first is a one-way service that
utilizes a telephone return path, in contrast to our two-way, high-speed
service, which does not require a telephone line. The other alternative is a
two-way, high-speed service, which requires additional equipment purchases by
the customer and is offered at higher prices than our own equivalent service.
Due to these differences we believe our high-speed data service is superior to
the satellite-delivered service.

Some Internet service providers, or ISPs offer dial-up Internet access service
over standard telephone lines in our markets. Dial-up service operates at much
lower speeds than cable modem service and is therefore not competitive with our
high-speed data service. A number of these ISPs have asked local authorities and
the FCC to give them rights of access to cable systems' broadband infrastructure
so that they can deliver their services directly to cable systems' customers.
This kind of access is often called "open access". Many local franchising
authorities have examined the issue of open access and a few have required cable
operators to provide such access. Several Federal courts have ruled that
localities are not authorized to require open access. The FCC has classified
cable modem service as an "information service," not as a "telecommunications
service." As an information service, the FCC has held that cable systems are not
required to open their networks for use by others to provide ISP services.
Although the United States Supreme Court recently held that cable modem service
was properly classified by the FCC as an "information service," freeing it from
regulation as a "telecommunications service," it recognized that the FCC has
jurisdiction to impose regulatory obligations on facilities based Internet
Service Providers. The FCC has an ongoing rulemaking to determine whether to
impose regulatory obligations on such providers, including us. While we cannot
predict the outcome of this proceeding, we do note that the FCC recently removed
the requirement that telecommunications carriers provide access to competitors
to resell their DSL Internet access service citing the need for competitive
parity with cable modem service which has no similar access requirement. If we
were required to provide open access to ISPs as a result of FCC action, other
companies could use our cable system infrastructure to offer Internet services
competitive with our own.

Certain telecommunications companies are seeking to provide high-speed broadband
services, including interactive online services, using wireless technologies
that may transcend present service boundaries and avoid certain regulatory
restrictions. Moreover, some electric utilities have announced plans to deliver
broadband services over their electrical distribution networks. The FCC has an
on-going rulemaking which, to date, appears limited to basic regulations to
avoid technical interference with existing services. If electric utilities
provide broadband services over their existing electrical distribution networks,
they could become formidable competitors given their resources.




                           LEGISLATION AND REGULATION

The section entitled "Business--Legislation and Regulation" in Part I, Item I of
the 2004 Annual Report is updated and modified in its entirety with the
following:

GENERAL

Federal, state and local laws regulate the development and operation of cable
communications systems. In the following paragraphs, we summarize the federal
laws and regulations materially affecting us and other cable operators and the
level of competition that we face. We also provide a brief description of
certain relevant state and local laws. Currently few laws or regulations apply
to Internet services. Existing federal, state and local laws and regulations and
state and local franchise requirements are currently the subject of judicial
proceedings, legislative hearings and administrative proceedings that could
change, in varying degrees, the manner in which cable systems operate. Neither
the outcome of these proceedings nor their impact upon the cable industry or our
business or operations can be predicted at this time.

FEDERAL REGULATION

The principal federal statutes governing the cable industry, the Communications
Act of 1934, as amended by the Cable Communications Policy Act of 1984, the
Cable Television Consumer Protection and Competition Act of 1992 and the
Telecommunications Act of 1996 (collectively, the "Cable Act"), establish the
federal regulatory framework for the industry. The Cable Act allocates principal
responsibility for enforcing the federal policies among the Federal
Communications Commission, or FCC and state and local governmental authorities.

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

 -- subscriber rates;

 -- the content of the programming we offer to subscribers, as well as the way
    we sell our program packages to subscribers;

 -- the use of our cable systems by the local franchising authorities, the
    public and other unrelated companies;

 -- our franchise agreements with local governmental authorities;

 -- cable system ownership limitations and prohibitions; and

 -- our use of utility poles and conduit.

The FCC and some state regulatory agencies regularly conduct administrative
proceedings to adopt or amend regulations implementing the statutory mandate of
the Cable Act. At various times, interested parties to these administrative
proceedings challenge the new or amended regulations and policies in the courts
with varying levels of success. Further court actions and regulatory proceedings
may occur that might affect the rights and obligations of various parties under
the Cable Act. The results of these judicial and administrative proceedings may
materially affect the cable industry and our business and operations.



SUBSCRIBER RATES

The Cable Act and the FCC's regulations and policies limit the ability of cable
systems to raise rates for basic services and customer equipment. No other rates
are subject to regulation. Federal law exempts cable systems from all rate
regulation in communities that are subject to effective competition, as defined
by federal law and where affirmatively declared by the FCC. Federal law defines
effective competition as existing in a variety of circumstances that
historically were rarely satisfied but are increasingly likely to be satisfied
with the recent increase in DBS penetration and the announced plans of some
local phone companies to offer comparable video service. Although the FCC is
conducting a proceeding that may streamline the process for obtaining effective
competition determinations, neither the outcome of this proceeding nor its
impact upon the cable industry or our business or operations can be predicted at
this time.

Where there is no effective competition to the cable operator's services,
federal law gives local franchising authorities the ability to regulate the
rates charged by the operator for:

 -- the lowest level of programming service offered by the cable operator,
    typically called basic service, which includes, at a minimum, the local
    broadcast channels and any public access or governmental channels that are
    required by the operator's franchise;

 -- the installation of cable service and related service calls; and

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

Local franchising authorities who wish to regulate basic service rates and
related equipment rates must first affirmatively seek and obtain FCC
certification to regulate by following a simplified FCC certification process
and agreeing to follow established FCC rules and policies when regulating the
cable operator's rates. Currently, the majority of the communities we serve have
not sought such certification to regulate our rates.

Several years ago, the FCC adopted detailed rate regulations, guidelines and
rate forms that a cable operator and the local franchising authority must use in
connection with the regulation of basic service and equipment rates. The FCC
adopted a benchmark methodology as the principal method of regulating rates.
However, if this methodology produces unacceptable rates, the operator may also
justify rates using either a detailed cost-of-service methodology or an add-on
to the benchmark rate based on the additional capital cost and certain operating
expenses resulting from qualifying upgrades to the cable plant. The Cable Act
and FCC rules also allow franchising authorities to regulate equipment rates on
the basis of actual cost plus a reasonable profit, as defined by the FCC.

If the local franchising authority concludes that a cable operator's rates are
too high under the FCC's rate rules, the local franchising authority may require
the cable operator to reduce rates and to refund overcharges to subscribers,
with interest. The cable operator may appeal adverse local rate decisions to the
FCC.

The FCC's regulations allow a cable operator to modify regulated rates on a
quarterly or annual basis to account for changes in:

 -- the number of regulated channels;

 -- inflation; and



 -- certain external costs, such as franchise and other governmental fees,
    copyright and retransmission consent fees, taxes, programming fees and
    franchise-imposed obligations.

The Cable Act and/or the FCC's regulations also:

 -- require cable operators to charge uniform rates throughout each franchise
    area that is not subject to effective competition;

 -- prohibit regulation of non-predatory bulk discount rates offered by cable
    operators to subscribers in multiple dwelling units; and

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

The FCC recently conducted an inquiry into the advisability of mandating the a
la carte offering of programming, as opposed to the cable industry's practice of
packaging numerous channels into tiers. Although the FCC recommended against an
a la carte mandate, it is possible that in the future rate regulation on the
cable industry could be expanded to include new restrictions on the retail
pricing or packaging of cable programming. Such restrictions could adversely
impact our business.

CONTENT REQUIREMENTS

MUST CARRY AND RETRANSMISSION CONSENT

The FCC's regulations contain broadcast signal carriage requirements that allow
local commercial television broadcast stations to elect once every three years
whether to require a cable system:

 -- to carry the station, subject to certain exceptions; or

 -- to negotiate the terms by which the cable system may carry the station on
    its cable systems, commonly called retransmission consent.

The Cable Act and the FCC's regulations require a cable operator to devote up to
one-third of its activated channel capacity for the carriage of local commercial
television stations. The Cable Act and the FCC's rules also give certain local
non-commercial, educational television stations mandatory carriage rights, but
not the option to negotiate retransmission consent. Additionally, cable systems
must obtain retransmission consent for carriage of:

 -- all distant commercial television stations, except for certain commercial
    satellite-delivered independent superstations such as WGN;

 -- commercial radio stations; and

 -- certain low-power television stations.

Under legislation enacted in 1999, Congress barred broadcasters from entering
into exclusive retransmission consent agreements (through 2006) and required
that broadcasters negotiate retransmission consent agreements in "good faith."
In November 2004, Congress extended the ban on exclusive retransmission consent
agreements to cover all multi-channel video programming distributors, including
cable operators.

The FCC has opened an inquiry into the impact on competition in the multichannel
video programming distribution market of the Cable Act's provisions and the
FCC's rules on retransmission consent, network nonduplication, syndicated
exclusivity and sports blackouts.



The FCC's inquiry will form the basis for a report to Congress mandated by the
Satellite Home Viewer Extension and Reauthorization Act of 2004 ("SHVERA"),
which is due September 8, 2005. Neither the outcome of this proceeding nor its
impact upon subsequent legislation, FCC regulations or the cable industry or our
business or operations can be predicted at this time.

Recently, the FCC imposed "reciprocal" good faith retransmission consent
negotiation obligations on cable operators. These rules identify seven types of
conduct that would constitute "per se" violations of the new requirements. Thus,
even though we may have no interest in carrying a particular broadcaster's
programming, we may be required under the new rules to engage in negotiations
within the parameters of the FCC's rules. While noting that the parties in
retransmission consent negotiations were now subject to a "heightened duty of
negotiation," the FCC emphasized that failure to ultimately reach an agreement
is not a violation of the rules. The impact of these rules on our business
cannot be determined at this time.

Must-carry obligations may decrease the attractiveness of the cable operator's
overall programming offerings by including less popular programming on the
channel line-up, while cable operators may need to provide some form of
consideration to broadcasters to obtain retransmission consent to carry more
popular programming. We carry both broadcast stations based on must-carry
obligations and others that have granted retransmission consent.

The FCC has issued a decision that effectively requires mandatory carriage of
local television stations that surrender their analog channel and broadcast only
digital signals. These stations are entitled to request carriage in their choice
of digital or converted analog format. Stations transmitting in both digital and
analog formats ("Dual Format Broadcast Stations"), which is permitted during the
current several-year transition period, have no carriage rights for the digital
format during the transition unless and until they turn in their analog channel.
The FCC has recently reaffirmed that cable operators are not required to carry
the digital signal of Dual Format Broadcast Stations that currently have
must-carry rights for their analog signals, however, changes in the composition
of the Commission as well as proposals currently under consideration could
result in an obligation to carry both the analog and digital version of local
broadcast stations or to carry multiple digital program streams. In addition to
rejecting a "dual carriage" requirement during the transition, the FCC also
confirmed that a cable operator need only carry a broadcaster's "primary video"
service (rather than all of the digital "multi-cast" services), both during and
after the transition. In addition, in November 2004, Congress passed a
non-binding resolution urging that legislation be considered in 2005 that would
set a firm date for the broadcasters to return their analog spectrum. The
adoption, by legislation or FCC regulation, of additional must-carry
requirements would have a negative impact on us because it would reduce
available channel capacity and thereby could require us to either discontinue
other channels of programming or restrict our ability to carry new channels of
programming that may be more desirable to our customers.

TIER BUY THROUGH

The Cable Act and the FCC's regulations require our cable systems, other than
those systems which are subject to effective competition, to permit subscribers
to purchase video programming we offer on a per channel or a per program basis
without the necessity of subscribing to any tier of service other than the basic
service tier.

The FCC has opened a matter with respect to another cable operator to determine
whether certain charges routinely assessed by many cable operators, including
us, to obtain access to



digital services, violate this "anti-buy-through" provision. An adverse decision
that could require us to restructure or eliminate such charges would have an
adverse effect on our business.

PROGRAM ACCESS

To increase competition between cable operators and other video program
distributors, the Cable Act and the FCC's regulations:

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

 -- require such programmers to sell their programming to other unaffiliated
    video program distributors; and

 -- limit the ability of such programmers to offer exclusive programming
    arrangements to their related parties.

OTHER PROGRAMMING

Federal law actively regulates other aspects of our programming, involving such
areas as:

 -- our use of syndicated and network programs and local sports broadcast
    programming;

 -- advertising in children's programming;

 -- political advertising;

 -- origination cablecasting;

 -- adult programming;

 -- sponsorship identification; and

 -- closed captioning of video programming.

USE OF OUR CABLE SYSTEMS BY THE GOVERNMENT AND UNRELATED THIRD PARTIES

The Cable Act allows local franchising authorities and unrelated third parties
to obtain access to a portion of our cable systems' channel capacity for their
own use. For example, the Cable Act:

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

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

The FCC regulates various aspects of third party commercial use of channel
capacity on our cable systems, including:

 -- the maximum reasonable rate a cable operator may charge for third party
    commercial use of the designated channel capacity;

 -- the terms and conditions for commercial use of such channels; and



 -- the procedures for the expedited resolution of disputes concerning rates or
    commercial use of the designated channel capacity.

FRANCHISE MATTERS

We have non-exclusive franchises in virtually every community in which we
operate that authorize us to construct, operate and maintain our cable systems.
Although franchising matters are normally regulated at the local level through a
franchise agreement and/or a local ordinance, the Cable Act provides oversight
and guidelines to govern our relationship with local franchising authorities.

For example, the Cable Act and/or FCC regulations and determinations:

Provide guidelines for the exercise of local regulatory authority that:

 -- affirm the right of franchising authorities, which may be state or local,
    depending on the practice in individual states, to award one or more
    franchises within their jurisdictions;

 -- generally prohibit us from operating in communities without a franchise;

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

 -- permit us to obtain modification of our franchise requirements from the
    franchise authority or by judicial action if warranted by commercial
    impracticability.

Generally prohibit franchising authorities from:

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

 -- imposing franchise fees on revenues we derive from providing
    telecommunications or information services over our cable systems;

 -- restricting our use of any type of subscriber equipment or transmission
    technology; and

 -- requiring payment of franchise fees to the local franchising authority in
    excess of 5.0% of our gross revenues derived from providing cable services
    over our cable system.

Encourage competition with existing cable systems by:

 -- allowing municipalities to operate their own cable systems without
    franchises; and

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

Provide renewal procedures:

 -- The Cable Act contains renewal procedures designed to protect us against
    arbitrary denials of renewal of our franchises although, under certain
    circumstances, the franchising authority could deny us a franchise renewal.
    Moreover, even if our franchise is renewed, the franchising authority may
    seek to impose upon us new and more onerous requirements, such as
    significant upgrades in facilities and services or increased franchise fees
    as a condition of renewal to the extent permitted by law. Similarly, if a
    franchising authority's consent is required for the purchase or sale of our
    cable system or franchise, the franchising authority



    may attempt to impose more burdensome or onerous franchise requirements on
    the purchaser in connection with a request for such consent. Historically,
    cable operators providing satisfactory services to their subscribers and
    complying with the terms of their franchises have almost always obtained
    franchise renewals. We believe that we have generally met the terms of our
    franchises and have provided quality levels of service. We anticipate that
    our future franchise renewal prospects generally will be favorable.

 -- Various courts have considered whether franchising authorities have the
    legal right to limit the number of franchises awarded within a community and
    to impose substantive franchise requirements. These decisions have been
    inconsistent and, until the U.S. Supreme Court rules definitively on the
    scope of cable operators' First Amendment protections, the legality of the
    franchising process generally and of various specific franchise requirements
    is likely to be in a state of flux.

The Cable Act and the FCC allow cable operators to pass franchise fees on to
subscribers and to separately itemize them on subscriber bills. In 2003 an
appellate court affirmed an FCC ruling that franchise fees paid by cable
operators on non-subscriber related revenue (such as cable advertising revenue
and home shopping commissions) may be passed through to subscribers and itemized
on subscriber bills regardless of the source of the revenues on which they were
assessed.

In connection with its decision in March 2002 classifying high-speed Internet
services provided over a cable system as interstate information services, the
FCC stated that revenues derived from cable operators' Internet services should
not be included in the revenue base from which franchise fees are calculated.
Although the United States Supreme Court recently held that cable modem service
was properly classified by the FCC as an "information service," freeing it from
regulation as a "telecommunications service," it recognized that the FCC has
jurisdiction to impose regulatory obligations on facilities based Internet
Service Providers. The FCC has an ongoing rulemaking to determine whether to
impose regulatory obligations on such providers, including us. Because of the
FCC's decision, we are no longer collecting and remitting franchise fees on our
high-speed Internet service revenues. We are unable to predict the ultimate
resolution of these matters but do not expect that any additional franchise fees
we may be required to pay will be material to our business and operations.

OWNERSHIP LIMITATIONS

The FCC previously adopted nationwide limits on the number of subscribers under
the control of a cable operator and on the number of channels which can be
occupied on a cable system by video programming in which the cable operator has
an interest. The U.S. Court of Appeals for the District of Columbia Circuit
overturned the FCC's rules implementing these statutory provisions and remanded
the case to the FCC for further proceedings.

The 1996 amendments to the Cable Act eliminated the statutory prohibition on the
common ownership, operation or control of a cable system and a television
broadcast station in the same service area. The identical FCC regulation has
been invalidated by a federal appellate court. The FCC has eliminated its
regulatory restriction on cross-ownership of cable systems and national
broadcasting networks.




The 1996 amendments to the Cable Act made far-reaching changes in the
relationship between local telephone companies and cable service providers.
These amendments:

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

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

 -- set basic standards for relationships between telecommunications providers;
    and

 -- generally limited acquisitions and prohibited joint ventures between local
    telephone companies and cable operators in the same market.

Pursuant to these changes in federal law, local telephone companies may now
provide service as traditional cable operators with local franchises or they may
opt to provide their programming over open video systems, subject to certain
conditions, including, but not limited to, setting aside a portion of their
channel capacity for use by unaffiliated program distributors on a
non-discriminatory basis. Open video systems are exempt from certain regulatory
obligations that currently apply to cable operators. The decision as to whether
an operator of an open video system must obtain a local franchise is left to
each community.

The 1996 amendments to the Cable Act allow registered utility holding companies
and subsidiaries to provide telecommunications services, including cable
television, notwithstanding the Public Utilities Holding Company Act of 1935, as
amended. In 2004, the FCC adopted rules: 1) that affirmed the ability of
electric service providers to provide broadband Internet access services over
their distribution systems; and 2) that seek to avoid interference with existing
services. Electric utilities could be formidable competitors to cable system
operators.

Legislation was recently passed in one state (in which we do not currently
operate cable systems) and similar legislation is pending or has been proposed
in certain other states and in Congress to allow local telephone companies to
deliver services would compete with our cable service without obtaining
equivalent local franchises. Such a legislatively granted advantage to our
competitors could adversely affect our business. The effect of such initiatives,
if any, on our obligation to obtain local franchises in the future or on any of
our existing franchises, many of which have years remaining in their terms,
cannot be predicted.

The Cable Act generally prohibits us from owning or operating a satellite master
antenna television system or multichannel multipoint distribution system in any
area where we provide franchised cable service and do not have effective
competition, as defined by federal law. We may, however, acquire and operate a
satellite master antenna television system in our existing franchise service
areas if the programming and other services provided to the satellite master
antenna television system subscribers are offered according to the terms and
conditions of our local franchise agreement.

CABLE EQUIPMENT

The Cable Act and FCC regulations seek to promote competition in the delivery of
cable equipment by giving consumers the right to purchase set-top converters
from third parties as long as the equipment does not harm the network, does not
interfere with services purchased by other customers and is not used to receive
unauthorized services. Over a multi-year phase-in period, the rules also require
multichannel video programming distributors, other than direct



broadcast satellite operators, to separate security from non-security functions
in set-top converters to allow third party vendors to provide set-tops with
basic converter functions. Beginning July 1, 2007 cable operators will be
prohibited from leasing digital set-top terminals that integrate security and
basic navigation functions.

To promote compatibility of cable television systems and consumer electronics
equipment the FCC recently adopted rules implementing "plug and play"
specifications for one-way digital televisions. The rules require cable
operators to provide "CableCard" security modules and support for digital
televisions equipped with built-in set-top functionality.

POLE ATTACHMENT REGULATION

The Cable Act requires certain public utilities, defined to include all local
telephone companies and electric utilities except those owned by municipalities
and co-operatives, to provide cable operators and telecommunications carriers
with nondiscriminatory access to poles, ducts, conduit and rights-of-way at just
and reasonable rates. This right to access is beneficial to us. Federal law also
requires the FCC to regulate the rates, terms and conditions imposed by such
public utilities for cable systems' use of utility pole and conduit space unless
state authorities have demonstrated to the FCC that they adequately regulate
pole attachment rates, as is the case in certain states in which we operate. In
the absence of state regulation, the FCC will regulate pole attachment rates,
terms and conditions only in response to a formal complaint. The FCC adopted a
new rate formula that became effective in 2001 which governs the maximum rate
certain utilities may charge for attachments to their poles and conduit by
companies providing telecommunications services, including cable operators.

Increases in attachment rates due to the FCC's new rate formula are phased in
over a five-year period in equal annual increments, beginning in February 2001.
This new formula will result in higher attachment rates than at present, but
they will apply only to cable television systems which elect to offer
telecommunications services. The FCC ruled that the provision of Internet
services will not, in and of itself, trigger use of the new formula. The Supreme
Court affirmed this decision and also held that the FCC's authority to regulate
rates for attachments to utility poles extended to attachments by cable
operators and telecommunications carriers that are used to provide Internet
service or for wireless telecommunications service. The recent Supreme Court
decision upholding the FCC's classification of cable modem service as an
information service, should strengthen our ability to resist such rate increases
based solely on the delivery of cable modem services over our cable systems. As
we continue our deployment of cable telephony and certain other advanced
services, utilities may continue to invoke the higher rates.

OTHER REGULATORY REQUIREMENTS OF THE CABLE ACT AND THE FCC

The FCC has adopted cable inside wiring rules to provide a more specific
procedure for the disposition of residential home wiring and internal building
wiring that belongs to an incumbent cable operator that is forced by the
building owner to terminate its cable services in a building with multiple
dwelling units.

The Cable Act and/or FCC rules include provisions, among others, regulating
other parts of our cable operations, involving such areas as:

 -- equal employment opportunity;

 -- consumer protection and customer service;



 -- technical standards and testing of cable facilities;

 -- consumer electronics equipment compatibility;

 -- registration of cable systems;

 -- maintenance of various records and public inspection files;

 -- microwave frequency usage; and

 -- antenna structure notification, marking and lighting.

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

COPYRIGHT

Our cable systems typically include in their channel line-ups local and distant
television and radio broadcast signals, which are protected by the copyright
laws. We generally do not obtain a license to use this programming directly from
the owners of the programming, but instead comply with an alternative federal
compulsory copyright licensing process. In exchange for filing certain reports
and contributing a percentage of our revenues to a federal copyright royalty
pool, we obtain blanket permission to retransmit the copyrighted material
carried on these broadcast signals. The nature and amount of future copyright
payments for broadcast signal carriage cannot be predicted at this time.

In a report to Congress, the U.S. Copyright Office recommended that Congress
make major revisions to both the cable television and satellite compulsory
licenses. In 1999, Congress modified the satellite compulsory license in a
manner that permits DBS service providers to become more competitive with cable
operators. Congress recently adopted legislation extending this authority
through 2009. The possible simplification, modification or elimination of the
cable communications compulsory copyright license is the subject of continuing
legislative review. The elimination or substantial modification of the cable
compulsory license could adversely affect our ability to obtain suitable
programming and could substantially increase the cost of programming that
remains available for distribution to our subscribers. We are unable to predict
the outcome of this legislative activity related to either the cable compulsory
license or the right of direct broadcast satellite providers to deliver local
broadcast signals.

Two recently filed petitions for rulemaking with the United States Copyright
Office propose revisions to certain compulsory copyright license reporting
requirements and seek clarification of certain issues relating to the
application of the compulsory license to the carriage of digital broadcast
stations. The petitions seek, among other things: (1) clarification of the
inclusion in gross revenues of digital converter fees, additional set fees for
digital service and revenue from required "buy throughs" to obtain digital
service; (2) reporting of "dual carriage" and multicast signals; and (3)
revisions to the Copyright Office's rules and Statement of Account forms,
including increased detail regarding services, rates and subscribers, additional
information regarding non-broadcast tiers of service, cable headend location
information, community definition clarification and identification of the county
in which the cable community is located



and the effect of interest payments on potential liability for late filing. We
understand that the Copyright Office intends to open one or more rulemakings in
response to these petitions. We cannot predict the outcome of such rulemakings,
however, it is possible that certain changes in the rules or copyright
compulsory license fee computations could have an adverse affect on our business
by increasing our copyright compulsory license fee costs or by causing us to
reduce or discontinue carriage of certain broadcast signals that we currently
carry on a discretionary basis.

Copyrighted material in programming supplied to cable television systems by pay
cable networks and basic cable networks is licensed by the networks through
private agreements with the copyright owners. These entities generally offer
through to-the-viewer licenses to the cable networks that cover the
retransmission of the cable networks' programming by cable television systems to
their customers.

Our cable systems also utilize music in other programming and advertising that
we provide to subscribers. The rights to use this music are controlled by
various music performing rights organizations from which performance licenses
must be obtained. Cable industry representatives negotiated standard license
agreements with the largest music performing rights organizations covering
locally originated programming, including advertising inserted by the cable
operator in programming produced by other parties. These standard agreements
require the payment of music license fees for earlier time periods, but such
license fees have not had a significant impact on our business and operations.

INTERACTIVE TELEVISION

The FCC has issued a Notice of Inquiry covering a wide range of issues relating
to interactive television ("ITV"). Examples of ITV services are interactive
electronic program guides and access to a graphic interface that provides
supplementary information related to the video display. In the near term, cable
systems are likely to be the platform of choice for the distribution of ITV
services. The FCC posed a series of questions including the definition of ITV,
the potential for discrimination by cable systems in favor of affiliated ITV
providers, enforcement mechanisms, and the proper regulatory classification of
ITV service.

PRIVACY

The Cable Act imposes a number of restrictions on the manner in which cable
television operators can collect, disclose and retain data about individual
system customers and requires cable operators to take such actions as necessary
to prevent unauthorized access to such information. The statute also requires
that the system operator periodically provide all customers with written
information about its policies including the types of information collected; the
use of such information; the nature, frequency and purpose of any disclosures;
the period of retention; the times and places where a customer may have access
to such information; the limitations placed on the cable operator by the Cable
Act; and a customer's enforcement rights. In the event that a cable television
operator is found to have violated the customer privacy provisions of the Cable
Act, it could be required to pay damages, attorneys' fees and other costs.
Certain of these Cable Act requirements have been modified by certain more
recent federal laws. Other federal laws currently impact the circumstances and
the manner in which we disclose certain customer information and future federal
legislation may further impact our obligations. In addition, some states in
which we operate have also enacted customer privacy statutes that are in some
cases more restrictive than those in federal law.



CABLE MODEM SERVICE

There are currently few laws or regulations that specifically regulate
communications or commerce over the Internet. Section 230 of the Communications
Act declares it to be the policy of the United States to promote the continued
development of the Internet and other interactive computer services and
interactive media, and to preserve the vibrant and competitive free market that
presently exists for the Internet and other interactive computer services,
unfettered by federal or state regulation. One area in which Congress did
attempt to regulate content over the Internet involved the dissemination of
obscene or indecent materials.

The Digital Millennium Copyright Act is intended to reduce the liability of
online service providers for listing or linking to third-party Websites that
include materials that infringe copyrights or other rights or if customers use
the service to publish or disseminate infringing materials. The Children's
Online Protection Act and the Children's Online Privacy Protection Act are
intended to restrict the distribution of certain materials deemed harmful to
children and impose additional restrictions on the ability of online services to
collect user information from minors. In addition, the Protection of Children
From Sexual Predators Act of 1998 requires online service providers to report
evidence of violations of federal child pornography laws under certain
circumstances.

A number of ISPs have asked local authorities and the FCC to give them rights of
access to cable systems' broadband infrastructure so that they can deliver their
services directly to cable systems' customers, which is often called "open
access". Many local franchising authorities have examined the issue of open
access and a few have required cable operators to provide such access, although
several federal courts have ruled that localities are not authorized to require
open access. The FCC, in connection with its review of the AOL-Time Warner
merger, imposed, together with the Federal Trade Commission, limited multiple
access and other requirements related to the merged company's Internet and
Instant Messaging platforms.

In March of 2002, the FCC announced that it was classifying Internet access
service provided through cable modems as an interstate information service, a
classification that is currently under review by the United States Supreme
Court. At the same time, the FCC initiated a rulemaking proceeding designed to
address a number of issues resulting from this regulatory classification,
including the following:

 -- the FCC confirmed that there is no current legal requirement for cable
    operators to grant open access now that cable modem service is classified as
    an information service. The FCC is considering, however, whether it has the
    authority to impose open access requirements and, if so, whether it should
    do so, or whether to permit local authorities to impose such a requirement.

 -- the FCC found that cable modem service is an information service, not a
    cable service, which has resulted in several court rulings that local
    franchise authorities may not collect franchise fees on cable modem service
    revenues under existing laws and regulations.

 -- the FCC concluded that federal law does not permit local franchise
    authorities to impose additional franchise requirements on cable modem
    service. It is considering, however, whether local franchise authorities
    nonetheless have the authority to impose restrictions, requirements or fees
    because cable modem service is delivered over cable using public rights of
    way.

 -- the FCC is considering whether cable operators providing cable modem service
    should be required to contribute to a "universal service fund" designed to
    support making service


    available to all consumers, including those in low income, rural and
    high-cost areas at rates that are reasonably comparable to those charged in
    urban areas.

 -- the FCC is considering whether it should take steps to ensure that the
    regulatory burdens on cable systems providing cable modem service are
    comparable to those of other providers of Internet access service, such as
    telephone companies. One method of achieving comparability would be to make
    cable operators subject to some of the regulations that do not now apply to
    them, but are applicable to telephone companies.

Challenges to the FCC's classification of cable Internet access service as an
information service and not a cable service or a telecommunications service have
been filed in federal court. Although the United States Supreme Court recently
held that cable modem service was properly classified by the FCC as an
"information service," freeing it from regulation as a "telecommunications
service," it recognized that the FCC has jurisdiction to impose regulatory
obligations on facilities based Internet Service Providers. The FCC has an
ongoing rulemaking to determine whether to impose regulatory obligations on such
providers, including us. The adoption of new rules by the FCC could impose
additional costs and regulatory burdens on us, reduce our anticipated revenues
or increase our anticipated costs for this service, complicate the franchise
renewal process, result in greater competition or otherwise adversely affect our
business. While we cannot predict the outcome of this proceeding, we do note
that the FCC recently removed the requirement that telecommunications carriers
provide access to competitors to resell their DSL Internet access service citing
the need for competitive parity with cable modem service which has no similar
access requirement. Any such requirements could adversely affect our results of
operations.

VOICE-OVER-INTERNET PROTOCOL TELEPHONY

The 1996 amendments to the Cable Act created a more favorable regulatory
environment for cable operators to enter the phone business. Currently, numerous
cable operators are exploring, planning or have commenced offering
Voice-over-Internet-Protocol ("VoIP") telephony as a competitive alternative to
traditional circuit-switched telephone service. Various states, including states
where we operate, have adopted or are considering differing regulatory
treatment, ranging from minimal or no regulation to full-blown common carrier
status. As part of the proceeding to determine any appropriate regulatory
obligations for VoIP telephony, the FCC recently decided that alternative voice
technologies, like certain types of VoIP telephony, should be regulated only at
the federal level, rather than by individual states. Many implementation details
remain unresolved, and there are substantial regulatory changes being considered
that could either benefit or harm VoIP telephony as a business operation. While
the final outcome of the FCC proceedings cannot be predicted, it is generally
believed that the FCC favors a "light touch" regulatory approach for VoIP
telephony, which might include preemption of certain state or local regulation.

STATE AND LOCAL REGULATION

Our cable systems use local streets and rights-of-way. Consequently, we must
comply with state and local regulation, which is typically imposed through the
franchising process. Our cable systems generally are operated in accordance with
non-exclusive franchises, permits or licenses granted by a municipality or other
state or local government entity. Our franchises generally are granted for fixed
terms and in many cases are terminable if we fail to comply with material



provisions. The terms and conditions of our franchises vary materially from
jurisdiction to jurisdiction. Each franchise generally contains provisions
governing:

 -- franchise fees;

 -- franchise term;

 -- system construction and maintenance obligations;

 -- system channel capacity;

 -- design and technical performance;

 -- customer service standards;

 -- sale or transfer of the franchise;

 -- territory of the franchise;

 -- indemnification of the franchising authority;

 -- use and occupancy of public streets; and

 --  types of cable services provided.

In the process of renewing franchises, a franchising authority may seek to
impose new and more onerous requirements, such as upgraded facilities, increased
channel capacity or enhanced services, although protections available under the
Cable Act require the municipality to take into account the cost of meeting such
requirements. The Cable Act also contains renewal procedures and criteria
designed to protect incumbent franchisees against arbitrary denials of renewal.

A number of states subject cable systems to the jurisdiction of centralized
state governmental agencies, some of which impose regulation of a character
similar to that of a public utility. Attempts in other states to regulate cable
systems are continuing and can be expected to increase. To date, other than
Delaware, no state in which we operate has enacted such state-level regulation.
State and local franchising jurisdiction is not unlimited; it must be exercised
consistent with federal law. The Cable Act immunizes franchising authorities
from most monetary damage awards arising from regulation of cable systems or
decisions made on franchise grants, renewals, transfers and amendments.

Legislation was recently passed in one state (in which we do not currently
operate cable systems) and similar legislation is pending or has been proposed
in certain other states and in Congress to allow local telephone companies to
deliver services that would compete with our cable service without obtaining
equivalent local franchises. Such a legislatively granted advantage to our
competitors could adversely affect our business. The effect of such initiatives,
if any, on our obligation to obtain local franchises in the future or on any of
our existing franchises, many of which have years remaining in their terms,
cannot be predicted.



                            DESCRIPTION OF THE NOTES

      The following was reported in this section:

      As of July 1, 2005, the total amount available for making Restricted
Payments under the indenture was approximately $325.0 million.