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SEC Filings

AVALON CABLE OF MICHIGAN INC/ filed this Form S-4 on 04/01/1999
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Policy Act of 1984 (the "1984 Cable Act") prohibits franchising authorities
from imposing annual franchise fees in excess of 5% of gross annual revenues
and also permits the cable television system operator to seek renegotiation
and modification of franchise requirements if warranted by changed
circumstances that render performance commercially impracticable.
   As indicated by the following chart, our franchises expire at various
points in time through the year 2019.

                                             Percentage of   Number of    Percentage of
      Year of Franchise          Number of       Total         Basic       Total Basic
      Expiration               Franchises(a) Franchises(a) Subscribers(a) Subscribers(a)
      -----------------        ------------- ------------- -------------- --------------
      <S>                      <C>           <C>           <C>            <C>
      1999-2001...............       55            12%         19,354            8%
      2002 and after..........      418            88         227,971           92
                                    ---           ---         -------          ---
      Total...................      473           100%        247,325          100%
                                    ===           ===         =======          ===

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(a) Calculated on a pro forma basis as of December 31, 1998 after giving
    effect to all completed and pending acquisitions.
   The Cable Television Consumer Protection and Competition Act of 1992 (the
"1992 Cable Act") and the Cable Communications Policy Act of 1984 (the "1984
Cable Act" and collectively with the 1992 Cable Act, the "Cable Acts")
provide, among other things, for an orderly franchise renewal process which
limits a franchising authority's ability to deny a franchise renewal if the
incumbent operator follows prescribed renewal procedures. In addition, the
Cable Acts established comprehensive renewal procedures which require, when
properly elected by an operator, that an incumbent franchisee's renewal
application be assessed on its own merits and not as part of a comparative
process with competing applications. For additional information, please refer
to the "Risk Factors" and "Regulation" sections of this prospectus.
   As a cable television systems operator, we face competition from:
  . alternative methods of receiving and distributing single and/or multiple
    channels of video programming, including direct-to-the-home satellite
    programming and off-air television broadcast programming;
  . other sources of news, information and entertainment such as newspapers,
    movie theaters, live sporting events, interactive online computer
    services and home video products, including videotape cassette recorders;
  . local exchange telephone companies and other well-financed businesses
    from outside of the cable industry (such as the public and municipally
    owned utilities that own certain of the poles on which cable is
    attached), which are increasingly entering the business of providing
    cable television services.
   The extent to which we are competitive depends, in part, upon our ability
to provide, at a reasonable price to consumers, a greater variety of
programming and other services than are available off-air or through other
alternative delivery sources and upon superior technical performance and
customer service. Many of our present and potential competitors have
substantially greater resources than we do.
   Congress has adopted legislation and the FCC has implemented regulations
which provide a more favorable operating environment for new and existing
technologies that provide, or have the potential to provide, substantial
competition to cable systems. For instance, the 1992 Cable Act contains
provisions, which the FCC has implemented with regulations, that enhance the
ability of cable competitors to purchase and make available to home satellite
dish owners certain satellite delivered cable programming at competitive
costs. In addition, the FCC adopted regulations that preempt certain local
restrictions on satellite and over-the-air antenna reception of video
programming services, including zoning, land-use or building regulations, or
any private covenants, homeowners' association rule, lease, or similar
restriction on property within the exclusive use or control of the antenna