[ X ] QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: September 30, 2000

[    ] TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to _____________

Commission file number: 0-28175

AFFORDABLE TELECOMMUNICATIONS TECHNOLOGY CORP.

(Exact name of small business issuer as specified in its charter)

(State or other jurisdiction of incorporation or organization)

6227 SW Freeway, Houston, TX

Check whether the issuer (1) filed all reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act during the past 12 months ( or for such shorter period that the registrant was required to file such report (s), and (2) has been subject to such filing requirements for the past 90 days. Yes [ X ] No [  ]

APPLICABLE ONLY TO CORPORATE ISSUERS

Page 1 of 13

Balance Sheets as of September 30, 2000 (Unaudited) and December 31, 1999.

September   30, 2000

December 31, 1999

ASSETS

$131,379

$4,962

49,360

19,912

232,131

59,939

100,000

-

143,611

-

656,481

84,813

1,109,113

643,265

32,159

21,739

514,603

108,041

$2,280,197

$836,119

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

247,170

54,722

614,346

312,828

200,000

71,335

2,695,229

625,490

(1,549,285)

(679,521)

1,310,944

(17,696)

$2,280,197

$836,119

  AFFORDABLE TELECOMMUNICATIONS TECHNOLOGY CORPORATION

  Statements of Operations for the Nine and Three Month Periods ended September 30, 2000 and 1999 (Unaudited).

For the

For the

For the

For the

Nine Months Ended

Nine Months Ended

Three Months Ended

Three Months Ended

September 30, 2000

September 30, 1999

September 30, 2000

September 30, 1999

$ 545,088

$92,178

270,669

51,565

274,419

40,613

483,520

55,036

3,966

96,316

34,383

-

7,917

6,393

621,818

(347,399)

24,628

(372,027)

-

$(372,027)

12,062,520

7,133,536

16,449,172

$(0.07)

$(0.04)

$0.00

$(0.00)

AFFORDABLE TELECOMMUNICATIONS TECHNOLOGY CORPORATION

Statements of Cash Flows for the Nine Month Periods ended September 30, 2000 and 1999 (Unaudited).

For the

For the

Nine Months

Nine Months

Ended

Ended

September 30,

September   30,

2000

1999

$ (869,763)

$(262,927)

63,280

12,680

(29,448)

(16,424)

(100,000)

-

192,448

30,430

(1,324,353)

(276,119)

(520,234)

-

(520,234)

-

2,198,404

218,808

(332,601)

(80,052)

42,307

113,700

1,971,004

252,456

126,417

(23,663)

4,962

53,849

$131,379

$30,186

$-

$- 

$46,873

$13,571

$3,000

$-

$ 424,006

$ -

NOTES TO FINANCIAL STATEMENTS FOR THE PERIOD ENDED SEPTEMBER 30, 2000

Note 1 - Basis of Presentation:

The financial information included herein is unaudited; however, such information reflects all adjustments (consisting solely of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of results for the interim periods. The results of operations for the nine months and three months ended September 30, 2000 are not necessarily indicative of the results to be expected for the full year.

Note 2 - Material Events:

During the three months ended September 30, 2000 the following events occurred: The Company issued and sold 6,245,000 shares of its common stock to private investors and received proceeds of $1,037,306 . Additionally, the Company issued 300,000 shares for current and future services, and issued 1,800,000 shares in a non-cash transaction in settlement of debt.

Note 3 - Other  Events:

(1) During the quarter ended September 30, 2000 the Company settled a legal action between the Company, Information Leasing Corporation and Eagle Wireless International related to the equipment used in the Company's Automatic Meter Reading business. The settlement involved the issuance of 1,800,000 restricted shares having a value of $ 424,006 at the date of issuance.

(2) During the three month period ended September 30, 2000, the Company  issued a total of 8,345,000 shares that were not registered under the Act. 6,245,000 shares were issued in sales to private investors, 300,000 shares were issued to consultants for current and future services and 1,800,000 shares were issued in settlement of debt. As a result of these transactions and after September 30, 2000 the Company had issued and outstanding 3,623,338 shares in excess of its authorized 20,000,000 shares of common stock. The Company is calling a special meeting of shareholders to approve, among other proposals, an increase in the number of  authorized shares of common stock.

(3) Subsequent to September 30, 2000 the Company issued an additional 2,689,600 shares of its common stock and received proceeds of $145,000. As a result of the issuance of 3,626,338 shares in excess of  the Company's authorized common stock of 20,000,000 shares, the Company has a liability of $62,894.

Item 2. Management’s Discussion and Analysis

Forward-Looking Statements; Market Data

The discussion in this report on Form 10-QSB contains forward-looking statements that involve risks and uncertainties. The statements contained in this Report that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding our expectations, beliefs, intentions or strategies regarding the future. All forward-looking statements included in this document are based on information available to us on the date hereof, and we assume no obligation to update any such forward-looking statements. Our actual results could differ materially from those described in our forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, our unproven business model and a limited operating history in a new and rapidly evolving industry; our ability to implement our business plan; and our ability to manage our growth, retain and grow our customer base and expand our service offerings.

We make forward-looking statements in the "Management’s Discussion and Analysis of Financial Condition and, Results of Operations" in this Quarterly Report. These forward-looking statements include, but are not limited to, statements about our plans, objectives, expectations, intentions and assumptions and other statements that are not historical facts. We generally intend the, words "expect", anticipate", "intend", "plan", "believe", "seek", "estimate" and similar expressions to identify forward-looking statements.

This Quarterly Report contains certain estimates and plans related to us and the wireless telecommunications industry in which we operate, which assumes certain events, trends and activities will occur and the projected information based on those assumptions. We do not know all that our assumptions are accurate. In particular, we do not know what level of growth in the wireless telecommunications and digital equipment industry, and particularly in those markets in which we operate and shall seek to expand. If our assumptions are wrong about any events, trends and activities, then our estimates for future growth for wireless telecommunications and our business may also be wrong. There can be assurances that an of our estimates as to our business growth will be achieved.

Results of Operations

During the three and nine month periods ended September 30, 2000 we had revenues of $545,088 and $925,061, respectively, compared to revenues of $92,178 and $212,531 for the comparable three and nine month periods of 1999. The increase in revenues during the three and nine month periods ended September 30, 2000 as compared to September 30, 1999 is principally the result of our acquisition of the business of Beeper Boutique and its nine retail locations, the acquisition of digital imaging equipment business of Camera's Etc., and the increase in our line of products and services.

We incurred a net loss of  $372,027 ($0.02 per share) and $869,763 ($0.07 per share) during the three month and nine month periods ended September 30, 2000  compared to a net loss of $38,838 ($0.01 per share) and $262,927 ($0.04 per share)  for the comparable three and nine month periods of 1999. The primary reasons for the net losses during the three and nine month periods ended September 30, 2000 compared to the same periods of 1999 is the result of the acquisition of the business of Beeper Boutique and the integration of its operations and the increased professional fees in connection with the acquisition. The expansion of our business also resulted in the substantial increase in the use of contract labor. Our contract labor expense for the three and nine month periods ended September 30, 2000 were $253,799 and $483,520 compared to $65,811 and $203,041 for the three and nine month periods ended September 30, 1999. Our increase in contract labor relates directly to our increase in revenues and the expansion in our operations.

There are no known trends, events or uncertainties that have had or that are reasonably expected to have a material adverse impact on the revenues or anticipated income from our continuing operation. There is an increasing trend toward use of wireless telecommunications equipment and services, including cellular telephones, pagers and other wireless equipment, by all segments of the population, including prepaid and regular use. We expect to benefit from this trend in the Texas Gulf Coast market which includes areas in both Southwest Texas and Louisiana. We also expect continued increased revenues as a result of the completion of the acquisition of the business and operations Beeper Boutique and certain economies resulting from our consolidation of the corporate offices and back office operations of Beeper Boutique into those of the Company at 6227 Southwest Freeway, Houston, TX.  We continue to evaluate new locations for our retail stores and may move certain stores to higher traffic locations to take advantage of the increased consumer awareness of our business and name in our markets. The wireless communications business is not subject to any seasonal aspects.

In addition, we are also endeavoring to commence operations in the business of automatic meter reading ("AMR"), which involves use of our existing wireless technology for the purpose of reading utility meters for residential and business customers. This is a new area of growth, we believe, in the South Texas and Louisiana Gulf Coast market. However, the  business of AMR is developing at a modest rate and a the Public Utilities Commission in Texas plans public hearings related to among other issues rates consumers will pay and amounts utilities may recover. We understand that the Texas Public Utilities Commission will consider and evaluate how other states have proceeded on the deregulation of utilities. While there can be no assurance with we will be successful in developing an AMR business in our market, we consider this business to be part of our long-term growth plan. We may consider whether to proceed with an AMR business by acquisition or through internal development, based upon our evaluation of the growth potential and the resources available to us.

Liquidity and Capital Resources

At September  30, 2000 we had current assets of $656,481 compared to current assets of $84,813 at December 31, 1999, an increase of   674%. The increase in current assets is primarily the result of an increase in cash of  $126,422 and an increase in inventory of $172,192. The increase in inventory is the result of our acquisition of the assets of Beeper Boutique and its nine retail store locations and our overall increase in product lines. We expect that this increase in inventory, which had a negative impact on our cash flow during the quarter ended September 30, 2000, will support our increase in sales during the fourth quarter and subsequent periods.  In addition, prepaid expenses increased by $143,611 and loans and exchanges increased by $100,000.

Our current liabilities at September 30, 2000 were $614,346, a decrease of $255,997 from current liabilities of $870,343 at June 30, 2000 and an increase of $301,518 from current liabilities of  $312,828 at December 31, 1999. The decrease from June 30, 2000 to September 30, 2000 is the principally the result of the reduction of our current portion of the capital lease obligations.

We have completed the acquisition of Beeper Boutique, a transaction that is likely to adversely impact our liquidity in the short term. The acquisition of the assets and business of Beeper Boutique and its nine retail stores and the positive cash flow that we anticipate from this acquisition should in the future improve our cash flow from operations. However, we are obligated to fund our purchase of the Beeper Boutique with cash and securities as well as pay the ongoing operating expenses.

During the three months ended September 30, 2000  we raised $1,037,306 through the sale of  shares to private investors, which shares were not registered under the Securities Act of 1933, as amended (the "Act"). The proceeds from such sales were utilized principally for working capital and to pay capital lease obligations. In addition, during the quarter ended September 30, 2000 we issued 1,800,000 restricted shares to a third party in exchange for shares of another public company unrelated to us. These shares were sold and the proceeds were used to settle a legal proceeding involving the Company, Information Leasing Corporation and Eagle Wireless International. Our issuance the 1,800,000 restricted shares was also based upon the exemption provided in Section 4 (2) under the Act.

During and subsequent to the end of the quarter ended September 30, 2000 we issued and sold restricted shares to private investors and issued shares to settle a legal proceeding. As a result of these transactions and through inadvertence, we issued approximately  3,623,338 shares in excess of our authorized capital stock of 20,000,000 shares of common stock. See Item 4, Part II below with respect to our filing of a proxy statement on Schedule 14A under the Exchange Act for a special meeting of shareholders in December 2000 for among other purposes approving an increase in our authorized shares of common stock. The affirmation vote by shareholders at the special meeting will result in the ratification of the issuance of shares in excess of our authorized capital stock, and will also provide additional shares of common stock for our corporate purposes including potential future acquisitions. Also see the Notes to Financial Statements.

There is also a trend in the wireless industry toward rapid technological change and development, but such trend should not adversely impact upon resellers and retail operators. As a result, other than the current portion of our long-term and capital leases, we do not know of any trends, events or uncertainties that have or are reasonably likely to have a material impact on our short-term or long-term liquidity. Our liquidity and ability to fund operations has been the result of operating revenues as well as sales of our securities to private investors.

RECENT ACCOUNTING PRONOUNCEMENTS

In June 1998, Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards No. 133, "Accounting for Derivative Instruments and Hedging Activities" (FAS 133). The new standard requires companies to record derivatives on the balance sheet as assets or liabilities, measured at fair value. Under FAS 133, gains or losses resulting from changes in the values of derivatives are to be reported in the statement of operations or as a deferred item, depending on the use of the derivatives and whether they qualify for hedge accounting. The key criterion for hedge accounting is that the derivative must be highly effective in achieving offsetting changes in fair value or cash flows of the hedged items during the term of the hedge. The Company is required to adopt FAS 133 in the first quarter of 2001. To date, the Company has not engaged in any foreign currency or interest hedging activities and does not expect adoption of this new standard to have a significant impact on the Company.

In December 1999, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 101 or SAB 101, Revenue Recognition in Financial Statements, which provides guidance on the recognition, presentation, and disclosure of revenue in financial statements filed with the Commission. SAB 101 outlines the basic criteria that must be met to recognize revenue and provides guidance for disclosures related to revenue recognition policies. The implementation of SAB 101 did not have a material effect on our financial position or results of operations.

In March 2000, the FASB issued Interpretation No. 44, "Accounting for Certain Transactions Involving Stock Compensation" an interpretation of APB Opinion No. 25 ("FIN 44"). This Interpretation clarifies the definition of "employee" for purposes of applying Accounting Practice Board Opinion No. 25, Accounting for Stock Issued to Employees (`APB 25'), the criteria for determining whether a plan qualifies as a non-compensatory plan, the accounting consequence of various modifications to the terms of a previously fixed stock option or award, and the accounting for an exchange of stock compensation awards in a business combination. This Interpretation is effective July 1, 2000, but certain conclusions in this Interpretation cover specific events that occur after either December 15, 1998, or January 12, 2000. Management believes that the impact of FIN 44 will not have a material effect on the financial position or results of operations of the Company.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK INTEREST RATE SENSITIVITY

The primary objective of our investment activities is to preserve principal while at the same time maximizing the income we receive from our investments without significantly increasing risk. Some of the securities that we may invest in may be subject to market risk. This means that a change in prevailing interest rates may cause the principal amount of the investment to fluctuate. For example, if we hold a security that was issued with a fixed interest rate at the then-prevailing rate and the prevailing interest rate later rises, the principal amount of our investment will probably decline. To minimize this risk in the future, we intend to maintain our portfolio of cash equivalents and short-term investments in a variety of securities, including commercial paper, money market funds, government and non-government debt securities. In general, money market funds are not subject to market risk because the interest paid on such funds fluctuates with the prevailing interest rate. As of June 30, 2000, all of our cash and cash equivalents were in money market and checking funds.

OTHER RISK FACTORS

OUR FAILURE TO MANAGE OUR GROWTH COULD HARM OUR ABILITY TO RETAIN AND GROW OUR CUSTOMER BASE AND EXPAND OUR BUSINESS SERVICES.

We may not be able to install management information and control systems in an efficient and timely manner, and our current or planned personnel, systems, procedures and controls may not be adequate to support our future operations. Failure to manage our future growth effectively could harm our ability to retain and grow our customer base and expand our business services  which would materially and adversely affect our business, prospects, operating results and financial condition.

BECAUSE OUR CUSTOMER ACQUISITION COSTS ARE HIGH, IF WE FAIL TO RETAIN CUSTOMERS LONG ENOUGH TO PAY BACK OUR UP FRONT INVESTMENT, WE MAY NOT ACHIEVE AND/OR MAINTAIN PROFITABILITY.

Our customer acquisition costs comprise a significant portion of our operating costs, including advertising, customer care and customer service on an on-going basis. Because of our significant up-front investment in each customer, if our customers terminate their relationships with us before we recover our up front costs, we may fail to generate a profit from such customers. In addition, if we fail to reduce our customer acquisition costs, including by increasing the efficiency of our customer care organization and reducing the costs associated with the development and offering of new services, our operating results will suffer.

OUR GROWTH DEPENDS ON OUR ABILITY TO HIRE AND RETAIN HIGHLY QUALIFIED EMPLOYEES AND EXECUTIVES.

The loss of the services of any of our management team, all but one of whom are at-will employees, or the failure to attract and retain additional key employees could harm the continued deployment of our services, the marketing of our services and the development of new services, our brand and our strategy. Our future growth and ability to sustain this growth depend upon the continued service of our officers and other key sales, operations, marketing and support personnel.

OUR OPERATING RESULTS ARE LIKELY TO FLUCTUATE SIGNIFICANTLY FROM PERIOD TO PERIOD WHICH MAY CAUSE OUR STOCK PRICE TO BE EXTREMELY VOLATILE. WE MAY ALSO FAIL TO MEET OR EXCEED THE EXPECTATIONS OF INVESTORS, CAUSING OUR STOCK PRICE TO DECLINE.

Our operating results are likely to fluctuate significantly in the future on a quarterly and an annual basis due to a number of factors, many of which are outside our control. If we experience such fluctuation, we may fail to meet or exceed the expectations of  investors, causing our stock price to decline or fluctuate from time to time.

WE MAY BE UNABLE TO RAISE ADDITIONAL CAPITAL IN THE FUTURE TO SUPPORT OUR GROWTH, AND EVEN IF WE ARE ABLE TO RAISE ADDITIONAL CAPITAL, IT MAY BE ON UNACCEPTABLE TERMS, MAY DILUTE YOUR OWNERSHIP OR MAY RESTRICT OUR FLEXIBILITY IN RUNNING OUR BUSINESS.

We intend to seek additional financing in the future to fund the growth of our operations, including funding the significant capital expenditures and working capital requirements necessary for us to complete our business plan. In order to accomplish this business plan, we must expand our network into geographic areas throughout the country, beginning with major markets in Texas, the Gulf Coast and elsewhere, establish relationships with local vendors in those areas and launch targeted marketing campaigns in those regions. If we are unable to raise additional capital or are able to raise capital only on unfavorable terms, we may not be able to complete our business plan which presently contemplates further acquisitions of existing businesses across the country, develop or enhance our services, take advantage of future opportunities or respond to competitive pressures or unanticipated requirements, any or all of which could hurt our ability to support our growth.

THE SCALABILITY, RELIABILITY AND SPEED OF THE   NETWORKS WE RELY UPON  MAY NOT SATISFY CUSTOMER DEMAND.

We may not be able to meet our projected customer numbers while achieving and maintaining superior performance. This risk will continue to exist as long as we expand our services geographically to increasing numbers of customers. Our failure to achieve our performance goals, for a number of reasons including the reliability and inter-operability of the networks we utilize, would significantly reduce customer demand for our services, resulting in decreased revenues and the inability to build our business as planned.

AT PRESENT, WE CANNOT PROVIDE OUR SERVICES UNLESS OUR ACCESS PROVIDERS SUPPLY US WITH RELIABLE WIRELESS CONNECTIONS AND COOPERATE WITH US FOR THE TIMELY PROVISION OF CONNECTIONS FOR OUR CUSTOMERS.

We must obtain wireless connections from telephone companies and new competitive carriers and have their continuing cooperation for the timely provision of wireless connections for our customers in order for us to provide our services. Wireless communications service uses the lines provided by local, regional and national communications carriers, which are under the control of well-established telephone companies and new competitive carriers and requires a special connection from our network to the telephone lines. We rely on them to provide us with these connections, and if we were unable to use and pay the costs of  these connections, we would not be able to provide our customers with our services. An inability to obtain adequate and timely access to wireless connections on acceptable terms and conditions from these telephone companies and competitive carriers and to gain their cooperation in the timely provision of such connections for our customers could harm our business, as could their failure to properly maintain the connections we use.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

From time to time, we may be involved in litigation that arises in the normal course of our business operations. We are presently not a party to any litigation that could have a material adverse impact on our operations. During the quarter ended September 30, 2000 we settled a legal action between the Company, Information Leasing Corporation and Eagle Wireless International related to the equipment used in our Automatic Meter Reading business. The settlement involved the issuance of 1,800,000 restricted shares having a value of $424,006 at the date of issuance.

Item 2. Changes in Securities

During the three month period ended September 30, 2000, we issued a total of 8,345,000 shares that were not registered under the Act. 6,245,000 shares were issued in sales to private investors, 300,000 shares were issued to consultants for services and 1,800,000 shares were issued in settlement of debt. We relied upon Section 4(2) under the Act as the basis for the exemption from the registration requirements of the Act. See Item 1 of Part II above.  Reference is also made to Item 4 below with respect to our intention to call a special meeting of shareholders to approve, among other proposals, an increase in our number of  authorized shares of common stock. See also Note 3 to the Notes to Financial Statements.

Item 3. Defaults upon Senior Securities

None

Item 4. Submission of Matters to a Vote of Security Holders

None. However, it is our intention to file a proxy statement on Schedule 14A under the Exchange Act with respect to a special meeting of shareholders for among other purposes the election of officers, ratification of the appointment of independent auditors and the approval of articles of amendment to our articles of incorporation to increase the number of our authorized shares of common stock and to authorize the issuance of shares of preferred stock. The preliminary proxy statement on Schedule 14A is anticipated to be filed with the SEC within ten days of the filing of this Quarterly Report on Form 10-QSB.

Item 5. Other Information

None

Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits:

Exhibit No.

Document Description

3(i)

3(ii)

27

Financial Data Schedule

(b) Form 8-K.

During the quarter ended September 30, 2000 we did not file any Report on Form 8-K.

SIGNATURES

In accordance with Section 12 or 15(d) of the Exchange Act, the small business issuer has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

AFFORDABLE TELECOMMUNICATIONS TECHNOLOGY CORPORATION