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S-4
AVALON CABLE OF MICHIGAN INC/ filed this Form S-4 on 04/01/1999
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 The New England Cluster--Operations
 
   The cable systems located in the New England Cluster are situated in central
Massachusetts and western New England. The following chart sets forth certain
pro forma information relating to the cable systems located in the New England
Cluster as of December 31, 1998, representing the cable systems acquired or to
be acquired by us in the Amrac, Pegasus, Taconic and Hometown acquisitions.
 

<TABLE>
<CAPTION>
                                 Western
                               New England
                                Charlton/    Winsted, CT/
              Central          Belchertown/ Berkshire, MA/
           Massachusetts          Hadley     Chatham, NY
           -------------       ------------ --------------
      <S>                      <C>          <C>
      Homes passed............    13,238        22,922
      Basic subscribers.......    10,995        15,143
      Basic penetration.......      83.1%         66.1%
      Premium units...........     2,885         3,390
      Premium penetration.....      26.2%         22.4%
      Average monthly revenue
       per basic subscriber...    $35.81(1)     $35.81(1)
</TABLE>

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(1) Data is only available on a consolidated basis.
 
   The residential communities located within the New England Cluster are
characterized by a growing middle class population base, close proximity to
urban centers, and limited off-air reception of local broadcast channels. The
majority of the New England Cluster's central Massachusetts systems are located
within a 30 to 60 minute driving radius of Springfield and Worcester, the
second and third largest cities in Massachusetts. More than 10 colleges and
universities are located within the immediate vicinity of the
Charlton/Belchertown/Hadley area, including the University of Massachusetts,
Amherst College and Smith College. The western New England systems are
comprised of systems located in Connecticut, Massachusetts and New York. The
Winsted system, which is located in the affluent area of Litchfield County,
serves seven communities located approximately 30 miles west of Hartford,
Connecticut. The Chatham system, which is located in eastern New York, and the
Berkshire system, which is located in western Massachusetts, are located
approximately 15 miles from each other and approximately 30 miles southeast of
Albany, New York.
 
   Giving effect to the Taconic and Hometown acquisitions, as of December 31,
1998, approximately 16% of our cable plant in the New England Cluster is 330
MHz (40 analog channels) or less. Over the next three years, we expect to
invest approximately $3 million to complete our capital plan for the New
England Cluster. Pursuant to our capital plan, we intend to deploy a fiber
optic network in Charlton, Massachusetts, rebuild approximately 90 miles of
cable plant in Winsted, the most densely populated area in the New England
Cluster, and upgrade the Belchertown cable plant. After the completion of our
planned upgrades, all of the New England Cluster's cable systems will have a
bandwidth capacity of at least 450 MHz (60+ analog channels). In addition, as
part of our consolidation effort, we plan to eliminate three of the New England
Cluster's seven headends within two years after the closing of the Taconic
acquisition.
 
   In the majority of the systems in the New England Cluster, we offer a single
level of basic service containing all off-air broadcast channels and certain
satellite delivered programming at an average price of $32.20 per month. In the
remaining systems, we offer tiers of basic cable television programming at an
average price of $10.95 per month for off-air broadcast channels and $16.05 per
month for satellite delivered programming. A limited number of systems offer an
additional package of 10 channels which include news, sports and other
specialized programming not otherwise included in the basic tiers. We plan to
reconfigure these programming packages to accommodate customer preferences and
to add additional tiered programming and premium channels as we complete our
capital plan for the New England Cluster.
 
   We believe that significant opportunities exist in the New England Cluster
to increase revenue per subscriber and eliminate certain costs. We believe that
the cable systems located in the New England Cluster did not aggressively
market their services prior to our acquisition of them. Through the aggregation
of the
 
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