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systems' bandwidth capacity to 550 MHz or greater so that we may offer advanced
cable services, increase program offerings and permit two-way communication. We
believe our upgraded Systems will also provide enhanced picture quality and
system reliability. Today, approximately 55% of our customers are served by
cable systems with at least 550 MHz bandwidth capacity, and approximately 37% of
our customers have two-way communication capability. By year end 2001, we expect
that approximately 92% of our customers will be served by cable systems with at
least 550 MHz bandwidth capacity and two-way communication capability. A
bandwidth capacity of 550 MHz enables us to offer our customers up to 82
channels of analog video service as well as advanced cable services. As we use
some of this bandwidth for digital service, we expect to offer our customers
even more channels and services at competitive rates.
     EMPHASIZING INNOVATIVE MARKETING.  We have developed and successfully
implemented a variety of innovative marketing techniques to attract new
customers and enhance the level of service provided to our existing customers.
Our marketing efforts focus on delivering well targeted, branded entertainment
and information services that provide value, choice, convenience and quality. We
utilize demographic "cluster codes" to address specific messages to target
audiences through direct mail and telemarketing. In addition, we promote our
services on radio, in local newspapers and by door-to-door selling. In many of
our systems, we offer discounts to customers who purchase multiple premium
services. We also have a coordinated strategy for retaining customers that
includes televised retention advertising to reinforce the link between quality
service and the Charter brand name and to encourage customers to purchase higher
service levels. Successful implementation of these marketing techniques has
resulted in internal customer growth rates in excess of the cable industry
averages in each year from 1995 through 1998 for the Charter Systems. The Marcus
Systems have been under common management with us since October 1998 and we have
begun to implement our marketing techniques throughout those systems.
     OFFERING NEW PRODUCTS AND SERVICES. By upgrading our systems, we will be
able to expand the array of services and advanced products we can offer to our
customers. Using digital technology, we will offer additional channels on our
existing service tiers, create new service tiers, introduce multiplexing of
premium services and increase the number of pay-per-view channels. We also plan
to add digital music services and interactive program guides. In addition to
these expanded cable services, we will also provide advanced services including
high-speed Internet access and interactive services. We have entered into
agreements with several providers of high-speed Internet and other interactive
services, including EarthLink Network, Inc. ("EarthLink"), High Speed Access
Corp. ("HSAC"), WorldGate Communications, Inc. ("WorldGate"), Wink
Communications, Inc. ("Wink") and At Home Corporation ("@Home").
     Our systems consist of approximately 65,900 miles of coaxial and
approximately 8,500 sheath miles of fiber optic cable passing approximately 3.9
million households and serving approximately 2.3 million customers. Today,
approximately 55% of our customers are served by systems with at least 550 MHz
bandwidth capacity, approximately 40% have at least 750 MHz bandwidth capacity
and approximately 37% are served by systems capable of providing two-way
interactive communication capability, such as two-way Internet connections, Wink
and interactive program guides.
     CORPORATE MANAGEMENT.  We are managed from our corporate office in St.
Louis, Missouri. Our senior management at that office consists of approximately
140 people led