NTL INC/NY/, 8-K, 1999-11-08

NTL INC/NY/
8-K, 1999-11-08
CABLE & OTHER PAY TELEVISION SERVICES

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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

----------------------------------

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of Earliest Event Reported): November 8, 1999
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NTL INCORPORATED
----------------
(Exact name of Registrant as Specified in Charter)

Delaware 0-25691 13-405-1921
- -------- ------- -----------
<S> <C> <C>
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)

</TABLE>

110 East 59th Street, New York, New York 10022
- ---------------------------------------- -----
(Address of Principal Executive Offices) (Zip Code)

Registrant's telephone number, including area code: (212) 906-8440
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N/A
-------------------------------------------------------------
(Former Name or Former Address, if Changed Since Last Report)

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ITEM 5. OTHER EVENTS.

The Company has distributed to certain persons an information
booklet regarding the business of the Company. A copy of the
booklet is attached hereto as Exhibit 99.1.

ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND
EXHIBITS.

99.1 Information Booklet.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.

NTL INCORPORATED

By: /s/ Richard J. Lubasch
----------------------
Name: Richard J. Lubasch
Title: Executive Vice President, General
Counsel and Secretary

Dated: November 8, 1999

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<PAGE> 4

EXHIBIT INDEX

Designation Description
----------- -----------
99.1 Information Booklet.

<PAGE> 1
EXHIBIT 99.1
------------

[EDGAR GRAPHIC DESCRIPTION: NTL Incorporated logo with quote from NTL CEO,
Barclay Knapp, as caption: "NTL leads the world in this new era of revolutionary
integrated broadband services. Our networks are state-of-the-art, but its really
our focus on innovation, customer service, and entrepreneurial spirit that keep
us at the top."]
<PAGE> 2

OVERVIEW

NTL is the leading broadband communications company in the United Kingdom
and the Republic of Ireland, and has recently announced the expansion of
operations through the acquisition of broadband cable systems in France and the
national broadcasting network facilities in Australia. We provide residential,
business, and carrier customers with a broad array of competitive communications
products and services including the following:

- RESIDENTIAL SERVICES, including residential telephone, cable television,
PC-based and television-based Internet access and interactive services.
INCLUDING OUR ACQUISITIONS OF CABLELINK IN IRELAND AND ON COMPLETION OF
OUR PROPOSED ACQUISITION OF THE CONSUMER CABLE, TELEPHONE, INTERNET AND
TELEVISION OPERATIONS OF CABLE & WIRELESS COMMUNICATIONS PLC IN THE
UNITED KINGDOM (ALSO KNOWN AS CONSUMERCO), WE WILL SERVE OVER 2.8 MILLION
RESIDENTIAL CUSTOMERS. Giving effect to our recent acquisitions, we will
be the largest provider of broadband services in the UK and Ireland. We
are also the first broadband provider in the UK to launch high-speed
cable modem Internet services. On completion of our proposed acquisition
of ConsumerCo, OUR FRANCHISES IN THE UK WILL COVER APPROXIMATELY 12
MILLION URBAN AND SUBURBAN HOUSEHOLDS (INCLUDING HOMES IN MANCHESTER,
LEEDS, GLASGOW, CARDIFF, BELFAST AND MOST OF METROPOLITAN LONDON) OR
APPROXIMATELY 50% OF THE UK'S TV HOUSEHOLDS. INCLUDING CONSUMERCO, OUR
NETWORKS HAVE BEEN BUILT PAST MORE THAN 8 MILLION HOMES. IN THE
FRANCHISES WHICH WE HAVE BEEN DEVELOPING SINCE 1993, WE HAVE MORE THAN
45% CUSTOMER PENETRATION, AN AVERAGE MONTHLY REVENUE PER CUSTOMER OF
BETWEEN $55-$60, WITH A GROSS MARGIN OF APPROXIMATELY 60% AND A MONTHLY
CHURN RATE OF APPROXIMATELY 1%. Additionally, approximately 40% of our
customers pay by direct debit thereby simplifying our billing and
collections process.

- NATIONAL TELECOMS SERVICES, including business telecoms, national and
international carrier telecommunications, Internet services and satellite
communications services. WE CURRENTLY SERVE OVER 60,000 BUSINESS AND
CARRIER CUSTOMERS INCLUDING: CISCO, SUN MICROSYSTEMS, MICROSOFT, MCI
WORLDCOM, AT&T, COLT, TURNER BROADCASTING SYSTEMS AND THE BBC.

- BROADCAST TRANSMISSION AND TOWER SERVICES, including digital and analog
television and radio broadcast transmission services, wireless network
management and tower site rental services. We broadcast channels for
customers such as Turner Broadcasting Systems, Flextech, BBC, QVC and TV
New Zealand. WE SERVE OUR BROADCASTING AND WIRELESS COMMUNICATIONS
CUSTOMERS UNDER LONG-TERM CONTRACTS THAT PROVIDE US WITH $1.8 BILLION OF
OUR COMPANY WIDE $2.5 BILLION FORWARD ORDER BOOK.

The industries in which we compete are growing rapidly as a result of
technological developments and the resulting increase in demand for bandwidth
and information handling capacity. The integration of communications services
and the Internet, as well as the development of digital wireless communications
services, is resulting in numerous growth opportunities for us.

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL transmission tower and fiber and
coaxial cable and telephone wires for Business and Home customers. The tower
appears at the bottom left corner of the page and the telephone cables appear
at the bottom right of the page.]

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OVERVIEW

OUR SUCCESS TO DATE HAS BEEN DUE LARGELY TO OUR FOCUS ON CUSTOMER SERVICE
AND THE DEVELOPMENT OF PRODUCT OFFERINGS THAT EMPHASIZE VALUE RATHER THAN SIMPLY
PRICE DISCOUNTS. Our product offerings incorporate our fundamental customer
proposition of providing our customer with choices:

"TO ALLOW OUR CUSTOMERS TO BUY WHAT THEY NEED AND PAY FOR WHAT THEY USE"

WE BELIEVE THAT THIS SIMPLE CONSTRUCT HAS ALLOWED US TO ACHIEVE AND
MAINTAIN THE INDUSTRY LEADING CUSTOMER PENETRATION AND CUSTOMER RETENTION LEVELS
WITHIN THE FRANCHISES THAT WE HAVE BEEN DEVELOPING SINCE 1993. We recently
expanded our consumer services through the national offer of PC and
television-based Internet access in combination with indirect access telephone
services. THESE PRODUCTS ALLOW US TO INCREASE OUR TARGET MARKET DRAMATICALLY BY
OFFERING OUR SERVICES TO RESIDENCES WHO WILL NOT BE PASSED BY OUR LOCAL
BROADBAND NETWORK INFRASTRUCTURE.

In the business market our sales strategy employs a mixture of telephone
sales and marketing for single line businesses and a direct and consultative
sales approach for the larger businesses. We are market-driven and have
segmented our business market into communities of interest -- for example,
education, government and industry. We treat our smaller towns in a similar
focused manner. The sales and marketing teams are structured to support this
approach:

- through a regionally focused sales and marketing structure; and

- through a dedicated team of national account managers interfacing with
the largest national accounts including many of the other
telecommunications carriers.

OUR COMPETITIVE POSITION IS UNDERPINNED BY THE $11 BILLION INVESTMENT WE
HAVE MADE IN OUR "FUTURE-PROOF" NETWORK INFRASTRUCTURE. THIS INVESTMENT ALLOWS
US TO SERVE EVERY RESIDENCE, BUSINESS, SCHOOL, HOSPITAL AND PUBLIC INSTITUTION
IN THE UK THAT IS EITHER DIRECTLY CONNECTED TO OUR NETWORK OR INDIRECTLY THROUGH
THE BT TELEPHONE NETWORK. This network infrastructure consists of:

- BROADBAND COMMUNICATIONS NETWORKS that are high-capacity two-way local
broadband fiber networks and that serve entire communities throughout our
regional franchise areas. OUR FIBER OPTIC CABLES PASS NEARLY EVERY
BUSINESS AND ARE CONNECTED TO NODES WHICH ARE TYPICALLY WITHIN
APPROXIMATELY 500 METERS OF EACH OF THE 600 HOMES TYPICALLY SERVED BY
EACH NODE. EACH HOME IS THEN CONNECTED BY A "SIAMESE" CABLE CONSISTING OF
TWO COPPER PAIR TELEPHONE WIRES AND A COAXIAL CABLE, ALLOWING US TO
DELIVER TELEPHONE, CABLE TELEVISION AND INTERNET SERVICES OVER A SINGLE
INTEGRATED NETWORK. This "Siamese" cable also allows us to deploy both
cable modems and DSL technology for the provision of broadband
communications services.

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OVERVIEW

THE FOLLOWING IS AN ILLUSTRATION OF THIS CABLING.

[EDGAR GRAPHIC DESCRIPTION: Illustration of cables for business and home
customers. The business cable is a fiber cable and the home cable is shown
divided into one coaxial cable and two pair of telephone wires. The graphic
illustrates the Company's use of copper telephone wires and coaxial cable to
deliver telephone, cable television and Internet services over a single
integrated network.]

- A NATIONAL/INTERNATIONAL SYNCHRONOUS DIGITAL HIERARCHY (KNOWN AS SDH)
FIBER OPTIC TELECOMMUNICATIONS NETWORK which connects all of the major
population centers in the UK to one another on our owned facilities and
to Ireland, Continental Europe and the United States through our owned or
leased facilities. IN THE UK, OUR SELF-HEALING, FULLY REDUNDANT 3,500
MILE BACKBONE NETWORK UTILIZES ASYNCHRONOUS TRANSFER MODE TECHNOLOGY
(KNOWN AS ATM), A HIGH-SPEED SWITCHING TECHNIQUE THAT USES FIXED SIZE
CELLS TO TRANSMIT VOICE, DATA AND VIDEO. THE NETWORK WAS BUILT WITH TWO
DUCTS AND SUFFICIENT CAPACITY TO ACCOMMODATE OVER 2,300 FIBERS ON THE
MAJORITY OF ITS ROUTES. We have designed this network to allow us to
place the active components (such as routing devices) at its edge and
close to our customers. This design will ultimately reduce our costs and
increase our ability to offer a broad range of voice and data solutions.

[EDGAR GRAPHIC DESCRIPTION: Illustration of "NTL's National Backbone Network."
Two ducts, each designated as four inches in diameter, are shown containing a
bundle of 48 fibers each. The fibers are described as having dual duct capacity
of .2304 and the graphic indicates that 10 fibers are lit on average.]

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OVERVIEW

- NATIONAL BROADCAST TRANSMISSION AND TOWER NETWORK INFRASTRUCTURE IN THE
UK AND AUSTRALIA, WHICH PROVIDE NATIONAL, REGIONAL AND LOCAL BROADCAST
AND WIRELESS COMMUNICATIONS COVERAGE AND IS COMPRISED OF OVER 1,313 AND
TOWER SITES IN THE UK AND 561 TOWER SITES IN AUSTRALIA.

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL transmission tower.]

OUR FIXED LINE AND TOWER-BASED NETWORKS IN THE UK ARE INTERCONNECTED AND

- allow us to provide our customers with flexible products, packages,
solutions and prices. For example, each of our regional broadband
networks is connected to our national/ international SDH fiber network,
allowing us to carry voice and data traffic between customer sites
throughout the UK and Ireland and significantly reduce our interconnect
charges. THIS FLEXIBILITY HAS ALLOWED US TO DEVELOP AND LAUNCH THE UK'S
FIRST DISTANCE INSENSITIVE TELEPHONE TARIFF, NTL 3-2-1 PENCE, WHICH IS A
FLAT RATE PER MINUTE TARIFF FOR CALLS WITHIN THE UK THAT CHARGES
CUSTOMERS TELEPHONE RATES BASED UPON TIME OF DAY CALLING RATHER THAN
DISTANCE OF THE CALL. ALL INTERNET TRAFFIC IS CHARGED AT 1P PER MINUTE
REGARDLESS OF THE TIME OF DAY; AND

- our national tower infrastructure has allowed us to connect business
customers to our national and international facilities with point to
point microwave links in situations where fiber connections are not
feasible. THIS OPPORTUNITY WILL BE FURTHER EXPANDED BY A LOCAL LOOP
ACCESS SOLUTION THAT UTILIZES OUR NATIONAL 10GHZ POINT TO MULTI-POINT
WIRELESS BROAD BAND LICENSE, COMPRISING 30MHZ OF SPECTRUM, ALLOWING US TO
CONNECT BUSINESS CUSTOMERS TO OUR NETWORKS WITH BROADBAND WIRELESS LINKS.

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OVERVIEW

RECENT ACQUISITIONS

During the last twelve months, we completed and announced a series of
acquisitions that have enhanced the scale and scope of our business
dramatically. We acquired Comcast UK, Comtel, Diamond, Cablelink, BT cable
franchises in Westminster and Milton Keynes, the "1G" Networks and agreed to
acquire ConsumerCo which increased our franchise homes on a pro forma basis by
over 350% to approximately 12 million homes. PRO FORMA FOR THESE ACQUISITIONS,
WE BECAME THE LARGEST PROVIDER OF BROADBAND COMMUNICATION SERVICES IN THE UK AND
IRELAND WITH APPROXIMATELY 2.8 MILLION CUSTOMERS. We intend to build upon our
success and experience to develop and improve the operating results of these
acquired franchises. We have also recently completed the acquisition of the
national broadcasting network facilities in Australia.

In respect of future possible acquisitions, it is our intention to
selectively duplicate our UK model in additional markets that will provide us
with an opportunity to capitalize on our experience in the UK. We believe that
we have a number of competitive advantages to bring to European opportunities.
First, we intend to utilize our experience and industry-leading success in
developing and operating any newly acquired businesses. In addition, our
existing UK national fiber network currently has connectivity to Continental
Europe and we intend to integrate this network with any communications networks
acquired in the future.

AUSTRALIA. In April 1999, we significantly expanded the sales and scope of
our broadcast business through the acquisition of the Australian National
Transmission Network, known as NTN, from the Australian government. NTN OPERATES
OVER 561 TOWER SITES AND PROVIDES EXCLUSIVE TELEVISION AND RADIO TRANSMISSION
SERVICES TO AUSTRALIA'S ONLY NATIONAL TV AND RADIO BROADCASTERS, ABC AND SBS. In
addition, NTN serves regional and community TV and radio broadcasters, and
provides equipment hosting services to telecom operators and emergency service
communications from its towers. NTN's customers include Telstra, WIN Television,
Prime Television, Vodafone and Air Services Australia. NTN holds long term
contractual relationships with the majority of its customers.

IRELAND. In June, we acquired Cablelink, Ireland's largest cable operator
with franchises in Dublin, Waterford and Galway. CABLELINK HAS ACHIEVED 83%
CUSTOMER PENETRATION, SERVING OVER 360,000 CUSTOMERS OF ITS 420,000 FULLY BUILT
FRANCHISE HOMES. IRELAND IS A MAJOR COMMUNICATIONS MARKET AND AFTER THE US,
ACCOUNTS FOR THE HIGHEST AMOUNT OF INCOMING AND OUTGOING TELEPHONE TRAFFIC TO
THE UNITED KINGDOM. We plan to upgrade the Cablelink networks for the provision
of digital cable, telephone, Internet and interactive services and expect to
increase the average gross profit contribution of the installed customer base
through the sale of these services. THE DUBLIN FRANCHISE WILL BE CONNECTED TO
OUR SIRIUS CABLE, THE ONLY SDH FIBER OPTIC LINK BETWEEN THE UK AND IRELAND,
ALLOWING US TO CONNECT THE SYSTEM TO OUR UK NETWORK AND SERVE THE FRANCHISE WITH
A DIGITAL CABLE FEED FROM OUR DIGITAL MEDIA CENTER IN THE UK. This connection to
our backbone network will also allow us to capitalize on the international voice
traffic flows between the UK and Ireland (traffic to the UK accounts for
approximately 75% of all international calls from Ireland). WE EXPECT THE
ACQUISITION TO BENEFIT FROM OTHER OPERATING EFFICIENCIES AS WELL, INCLUDING
THOSE RESULTING FROM THE INTEGRATION OF CABLELINK WITH OUR OPERATIONS IN
NORTHERN IRELAND.

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OVERVIEW

CONTINENTAL EUROPE. In August 1999, we acquired our first broadband
venture in Continental Europe with the acquisition of the "1G Networks" of
France Telecom representing over 266,000 franchise homes and 51,000 basic and
25,000 master antenna subscribers. THE DECISION TO EXPAND INTO CONTINENTAL
EUROPE WAS REINFORCED BY OUR ABILITY TO UTILIZE OUR DIGITAL MEDIA CENTER TO
DELIVER "ENHANCED" DIGITAL CABLE ENTERTAINMENT SERVICES TO CONTINENTAL EUROPE.
The connection of our existing UK national fiber network to Continental Europe
will not only allow us to carry our own telecommunications traffic throughout
Continental Europe and the UK, but will also allow the acquired systems to
benefit from our UK digital media center. Moreover, enhanced digital television
feed from our digital media center facilitates our vision of TV-based Internet
access products distributed through in-place telephone or cable lines throughout
Europe.

CORPORATE STRATEGY

Our objective is to exploit the convergence of the telecommunications,
entertainment and information services industries to become the leading full
service broadband communications company in the markets in which we compete. We
offer services to residential, business and wholesale customers on a national
and an international scale. We believe that we will be able to deliver our
strategy based on our entrepreneurial approach, innovative marketing,
state-of-the-art network and technical excellence. We are currently employing
several strategies to achieve our objective:

- INSTALLING FLEXIBLE INTEGRATED FULL-SERVICE NETWORKS. Our integrated
full-service networks provide a HIGH-SPEED, HIGH-CAPACITY, TWO-WAY
COMMUNICATIONS PATHWAY to the consumer that is capable of delivering new
services which are emerging from the convergence of telecommunications,
information and entertainment. THIS STRATEGY ALLOWS US TO PURSUE FOUR
REVENUE STREAMS -- RESIDENTIAL CABLE TELEVISION, RESIDENTIAL TELEPHONE,
BUSINESS TELECOMMUNICATIONS SERVICES AND INTERNET SERVICES -- WITHOUT
SIGNIFICANT INCREMENTAL COST OR CAPITAL INVESTMENT.

- MAXIMIZING NETWORK CAPACITY UTILIZATION. The fixed cost structure of
building communications networks allows us to gain significant operating
efficiencies from incremental services provided over our networks. IN OUR
LOCAL FRANCHISE AREAS, OUR STRATEGY IS TO MAXIMIZE GROSS PROFIT
CONTRIBUTION PER HOME PASSED, RATHER THAN REVENUE PER CUSTOMER, BY
INCREASING OVERALL PENETRATION OF THE NUMBER OF SERVICES PROVIDED OVER
OUR NETWORK. EXAMPLES OF THIS STRATEGY ARE THE DEVELOPMENT OF BUNDLED
PRODUCT OFFERINGS THAT ENCOURAGE SUBSCRIPTIONS TO MULTIPLE SERVICES,
MULTIPLE TELEVISION PRICING PLANS THAT APPEAL TO DIFFERING AND DISTINCT
MARKET SEGMENTS AND PRICE POINTS, AND MORE "A LA CARTE" AND TRANSACTION-
ORIENTED SERVICES WHICH INCREASE NETWORK UTILIZATION. This strategy
resulted in the design and launch of the "Choices" marketing packages
described below under "Residential Services -- Products, Services and
Marketing," which increased our overall penetration rates as well as our
overall percentage of dual subscribers.

- FOCUSING ON TARGET MARKET SEGMENTS. WE BELIEVE THAT TAILORING OUR
SERVICES TO THE NEEDS OF OUR CUSTOMERS WILL INCREASE THE PENETRATION OF
THESE SERVICES. Examples of tailored services include the

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OVERVIEW

development of private telecommunications networks geared to "captive"
local organizations such as governmental and educational institutions. We
have a track record of distinguishing ourselves by providing flexible and
customized solutions to meet our customers' individual requirements.

- PROVIDING SUPERIOR CUSTOMER SERVICE. WE BELIEVE CUSTOMER SERVICE AND
ATTENTIVENESS TO THE NEEDS OF CUSTOMERS ARE CRITICAL TO THE CONTINUED
GROWTH OF OUR RESIDENTIAL AND BUSINESS SERVICES. We operate multiple
customer call centers, including three large call centers in Luton, South
Wales and Central Scotland, as well as multiple call centers throughout
the regions of our recently acquired businesses. Calls are answered at
most locations 24 hours a day, 365 days a year. The customer call centers
currently employ approximately 2,600 people (including recent
acquisitions), who are specially trained to deal with customers'
inquiries and needs with respect to our various products and services.
Each customer representative attends an in-house specialized training
program, which is focused on increasing a representative's knowledge of
our corporate culture and products and providing the individual with
specific sales skills as well as a better understanding of the level of
service expected to be provided to potential and existing customers on an
ongoing basis. Finally, as we recognize the importance of the
installation in the customer's satisfaction with the services, we have
focused on monitoring installers' performance closely to ensure
compliance with strict quality standards and scheduling installations to
suit customers' requirements.

- DEVELOPING ADVANCED MANAGEMENT INFORMATION SYSTEMS. We believe that
advanced management information systems are critical to effectively,
efficiently and accurately serving our customers. WE USE PROPRIETARY
SOFTWARE TO HANDLE OUR SUBSCRIBER MANAGEMENT FUNCTIONS FROM ONE CENTRAL
LOCATION. The system uses Windows-based software and can handle both
business and residential customers as well as telephone, cable television
and Internet services on a single platform. It is capable of managing our
tariff and discounting structures, and will also allow for the
introduction of new telephone and cable television services, such as 0800
numbers. Additionally, the system provides the functionality to support
the customer representatives' inquiry handling and contributes to our
high level of customer service. For example, customer representatives
have on-line access to customers' billing, payment and subscription
histories. Because this is a proprietary system, we have the ability to
upgrade the system to meet our developing needs. To this end, we employ
our in-house staff of IT professionals to make sure the system retains
its robustness.

- GAINING COST EFFICIENCIES. We gain cost efficiencies by centralizing
some services provided to the franchise areas in our head office in Hook,
England. Examples include network planning, marketing, finance,
information systems and legal affairs. Alternatively, those cost centers
which are critical to
penetration are located as close to the customer as possible. Examples
include construction management, sales, customer service, and network
maintenance, which are all located in each of our regional areas.

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RESIDENTIAL SERVICES

Including our proposed acquisition of Consumer Co., our local franchise
areas cover approximately 12 million homes (not including France), spanning a
broad geographic area across England, Scotland, Wales, Northern Ireland and the
Republic of Ireland. OUR NETWORKS SERVE ENTIRE REGIONAL COMMUNITIES, PASSING
VIRTUALLY EVERY HOME, BUSINESS, AND GOVERNMENT INSTITUTION. WE CURRENTLY PROVIDE
OUR TELEPHONE SERVICES OVER THE TRADITIONAL TELEPHONE WIRES AND OUR CABLE
SERVICES OVER A COAXIAL CABLE CONNECTION. We estimate that, including recent and
proposed acquisitions, our local franchise networks (not including our national
network) cover approximately 15,000 route miles of fiber backbone network, with
approximately 700,000 fiber miles, and an estimated 100,000 route miles of
coaxial/copper connections. These full-service networks are capable of providing
a high speed, high capacity, two-way voice, data and video communications
pathway to every customer. This approach allows us to pursue four revenue
streams (residential telephone, residential cable television, Internet services
and business telecommunications services) without a significant increase in
fixed investment. A graphical depiction of our regional networks appears below.

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL's regional network showing six
nodes. Within the fibre rings covered by the nodes are business parks, schools/
hospitals, a city center, industrial areas and homes. Each node is depicted as
serving 600 homes. Coax/copper cables are shown connecting nodes to distribution
points serving 60 homes and then connecting to individual homes. The business
parks, city center and industrial areas are shown as connected to the nodes by
fibre cable. The city center and industrial center are each surrounded by a high
capacity fiber ring. Several of the nodes are shown connected to a telephone
switch and cable head end which is shown as connected to NTL's national fiber
network.]

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTLfiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

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RESIDENTIAL SERVICES

Our cable entertainment network employs a coaxial cable and is built to a
750MHz specification, which is easily expandable to 1 GHz of capacity. THE
NETWORK CURRENTLY HAS AN ACTIVE REVERSE PATH THAT ALLOWS US TO PROVIDE IMPULSE
PAY-PER-VIEW. MOST IMPORTANTLY, THE FACT THAT WE HAVE INSTALLED BOTH TWO PAIR OF
TELEPHONE WIRES AND COAXIAL CABLES INTO EACH OF OUR CUSTOMERS HOMES ALLOWS US
THE ADVANTAGE OF DEPLOYING EITHER OF THE MAJOR HIGH BANDWIDTH COMMUNICATIONS
TECHNOLOGIES THAT ARE DEVELOPING TODAY: CABLE MODEMS AND XDSL SOLUTIONS. The
graphic below depicts this advantage.

[EDGAR GRAPHIC DESCRIPTION: Illustration of two separate copper and coaxial
cables traveling from a home node within a single duct, all extending to a
customer's home. The customer's home receives 750 MHz to 1 GHz of bandwidth,
which equals about 60 channels. There is a reverse path of 50 MHz. There is also
shown a fiber cable linking a business location to the home node. The home node
is shown to be connected to a switch through fiber cable and the switch is
connected to a Web Server.]

NETWORK DESIGN. WE ARE INSTALLING OUR BROADBAND AND TELECOMMUNICATIONS
NETWORK USING ESTABLISHED STATE-OF-THE-ART TECHNOLOGY, DEPLOYING FIBER OPTICS
DIRECTLY TO HIGHLY CONCENTRATED BUSINESS AREAS AND RESIDENTIAL NODES TYPICALLY
AVERAGING 600 TELEPHONE LINES OR 600 HOMES RESPECTIVELY. WE INSTALL SPARE DUCT
AND CAN THUS "PULL" FIBER INTO EVERY HOME WHEN ECONOMICALLY JUSTIFIABLE. In this
manner, we achieve the cost efficiencies and rapid deployment from using
standardized equipment, while retaining the flexibility to expand and adapt our
network to technological advances with little or no additional construction
investment.

The design and construction of a new network varies depending upon several
factors including the number of route miles to be installed, density of homes
and businesses, type of road and sidewalk surface, and the architecture of the
network backbone. Each system has been designed with at least one head-end and
at least one telephone switching office. Each system's head-end and telephone
switching office is directly connected to each node by fiber optic cable. Each
node is then connected to a subscriber's premises. Construction of each system
has been planned on a neighborhood-by-neighborhood basis to allow revenue
generating operations to commence in a neighborhood as construction of the
portion of the system serving such neighborhood is completed.

FIBER OPTICS. The evolution of fiber optic technology over the past
decade, including increases in the capacity of laser transmitters and decreases
in the price of optical receivers, has enabled the economic deployment of fiber
optic cable much closer to the customer than in traditional coaxial cable
television and

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

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RESIDENTIAL SERVICES

twisted copper pair telephone networks, thereby improving the quality and
capacity of the cable television and telephone service. The main advantages of
deploying fiber in place of both coaxial cable or copper wire are its smaller
size, greater capacity, freedom from electrical interference, and significant
reduction of the requirement for periodic maintenance. We deploy fiber to nodes
which are normally less than 500 meters from the furthest home.

NETWORK ARCHITECTURE. Our broadband networks are being built with an
initial capacity of 750 MHz, which is sufficient to carry over 60 analog
channels of television. With digital compression of the television signal, many
more channels can be transmitted. The system is upgradeable to 1 GHz. Generally,
a maximum of one amplifier is required between the head-end optical receivers
and a home. Traditional cable systems often employ "cascades" of more than 5
amplifiers which degrade signal quality and increase the chances of system
failure.

Our local telecommunications network uses an SDH self-healing
redundant-ring based architecture, which improves our ability to flexibly deploy
capacity and further enhances system resilience. Telephone signals are carried
from the node to the home over traditional copper pair, over a shorter distance
than in traditional telephone networks, which improves signal quality and allows
higher bandwidth services such as ADSL to be more easily deployed. WITHIN A
RESIDENTIAL NODE, WE USE A "DUAL DROP" CONSISTING OF "SIAMESE" COAXIAL CABLE,
CAPABLE OF TRANSMITTING UP TO 1 GHZ OF BANDWIDTH, AND TWO COPPER TWISTED PAIRS
CAPABLE OF PROVIDING TWO TELEPHONE CONNECTIONS. MOREOVER, THE "DUAL DROP" IS
PLACED IN AN UNDERGROUND CONDUIT THAT HAS CAPACITY FOR A "FIBER DROP" IN THE
FUTURE. Large business customers are connected to the telephone network directly
through fiber optic cable or microwave links.

AS NOTED ABOVE, OUR NETWORK DESIGN ALLOWS US TO IMPLEMENT EITHER OF THE TWO
MAIN BROADBAND LOCAL-LOOP SOLUTIONS: CABLE MODEMS AND DSL. THE USE OF XDSL
TECHNOLOGIES COULD ENABLE US TO EXPLOIT OUR COPPER WIRE ASSETS MORE FULLY. We
already use HDSL to meet the needs of particular business customers. ADSL speeds
vary according to the length of the copper wire loop; the advantage that we have
compared to an established telephone company is our relatively short copper wire
runs -- typically under 500m. This facilitates down-load speeds of over 6 Mb/s.

PRODUCTS, SERVICES AND MARKETING

NTL BELIEVES THE MOST EFFECTIVE STRATEGIES TO ACHIEVE MAXIMUM REVENUES AND
MAXIMUM PENETRATION IS TO BUNDLE TELEPHONE, CABLE AND INTERNET SERVICES. OUR
PRODUCT AND PRICING STRATEGIES EMPHASIZE CHOICE, VALUE, AND QUALITY AND ARE
DESIGNED TO ENCOURAGE SUBSCRIPTION TO MULTIPLE SERVICES AND MAXIMIZE CUSTOMER
RETENTION. We believe that people want a value proposition based upon packages
of services. We believe that our ability to design attractive marketing plans
and better package services relative to our competitors should have a positive
effect on our penetration rates and customer retention.

BUNDLED CABLE SERVICES

In 1996 we implemented a promotional pricing and packaging structure called
"Choices" for our in-region telephone and cable television service. WE HAVE
CONTINUED TO REFINE AND ENHANCE THE INITIAL PACKAGE. THE

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

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RESIDENTIAL SERVICES

CURRENT MONTHLY PRICE FOR THE STARTER PACK IS L8.92, WHICH IS THE SAME AS BT'S
MONTHLY LINE RENTAL CHARGE AS OF SEPTEMBER 1999. The Starter Pack offers the
customer:

- TELEPHONE SERVICE;

- INTERNET ACCESS SERVICE; AND

- ALL SIX OF THE TERRESTRIAL CHANNELS, SEVEN CABLE TELEVISION CHANNELS AND
OUR LOCAL TV CHANNEL; OR

- A SECOND TELEPHONE LINE.

THIS MEANS THAT OUR CUSTOMERS CAN RECEIVE THEIR TELEPHONE LINE PLUS INTERNET
ACCESS AS WELL AS CABLE TELEVISION OR A SECOND TELEPHONE LINE FOR THE SAME
MONTHLY PRICE THAT BT CHARGES FOR TELEPHONE LINE RENTAL ALONE (PRIOR TO BT'S NEW
PRICING STRUCTURE EFFECTIVE OCTOBER 1, 1999; SEE "TELEPHONE TARIFF" SECTION FOR
MORE DETAIL). Our customers can add either of the services they do not choose as
a part of the package for L5 each. THE L8.92 PRICE POINT WAS SPECIFICALLY CHOSEN
TO PROVIDE THE CUSTOMER WITH A SIMPLE PRICE/VALUE PROPOSITION: FOR THE PRICE OF
A BT TELEPHONE LINE, WE PROVIDE A TELEPHONE LINE AND MORE. BT has a long history
of raising its line rental charge annually, creating a rising pricing umbrella
under which we can position our services. We continue to improve the packaging
structure in order to enhance its attractiveness to customers.

In addition to the Starter Pack entry packages our Choice Collections
packages enable the customer to select from several channel groupings each of
which can be purchased for an additional charge.

WE BELIEVE THAT OUR BUNDLED AND FLEXIBLE SERVICE PACKAGE IS RESPONSIVE TO
THE DESIRES AND TASTES OF OUR CUSTOMERS. IT EMPHASIZES THE "VALUE" OF OUR
RESIDENTIAL TELEPHONE SERVICE BY BUNDLING IT WITH A CHOICE OF ADDITIONAL
SERVICES FOR THE PRICE OF BT'S TELEPHONE LINE RENTAL. As opposed to choosing
from a limited set of service options, the packages provide the customer the
opportunity to add services according to their individual tastes, and change
various aspects of the bundle rather than disconnect the service completely.
Through the use of our customer care and billing systems, we can change our
customers' services quickly and easily, thus encouraging each customer to choose
a package that meets his or her individual needs. We seek to gain incremental
revenues by selling additional products and services as well as encouraging
customers to purchase higher tier packages. THE STARTER PACK SERVES AS A SHOP
WINDOW FOR OTHER INCREMENTAL SERVICES.

PAY PER VIEW SERVICES. We entered into a joint venture with Telewest for
the provision of a cable-only movie, sport and special events pay-per-view
television service called Front Row which was launched to our customers in March
1998. THE JOINT VENTURE REPRESENTS THE FIRST-EVER ALTERNATIVE TO BSKYB IN THE
PROVISION OF MOVIE AND SPORTS FOR PAY TELEVISION. Front Row has signed content
output contracts with major Hollywood studios, including Warner Brothers, Sony
Pictures Entertainment (Columbia/Tristar), the Walt Disney Company (Walt Disney
Studios, Miramax, Hollywood Pictures and Touchstone), Dreamworks, MGM and
Universal. Since its launch, Front Row has been very popular, currently selling
over 170,000 movies per month.

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

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"CHOICES"

<TABLE>
<S> <C> <C>
STARTER PACK L8.92 TELEPHONE CHOICES CHOICE COLLECTIONS
- ---------------------------- ---------------------------- ----------------------------
Includes: - Extra telephone line, or - Music & youth,
- - Telephone Line Rental and additional converter - Classic,
- - Dial-up PC Internet Access boxes L5.00 - News & documentary,
each - Contemporary
- Two TV packs L 8.00
Plus choose one of the - Advance features: reminder - Four TV packs L13.00
following: call, three-way calling,
speed
- - Television Service with dialing, call barring, BSKYB PACKAGES
six terrestrial and seven voicemail, call divert, ----------------------------
cable channels call - Sky Sports 1 or 2 L16.00
Or waiting - Movie Collection L17.00
- - 2nd Telephone Line - Sport Collection L20.00
- One Feature L1.00 - Movie & Sports
Collection L23.00
- All Six L3.00
PAY PER VIEW
----------------------------
TELEPHONE PRICING - Movies on Demand
---------------------------- Per Screening L2.99
- 3,2,1 pence Nationwide
3 pence for the day, 2
pence
for the evenings, and 1
pence
for the weekends
- 1 pence for Internet
Access at all times
</TABLE>

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

12
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"CHOICE COLLECTIONS"

<TABLE>
<S> <C>
CHOICE COLLECTIONS CHANNEL LINE-UP
- ------------------------------------------ ------------------------------------------
Music and Youth MTV, VH-1, Cartoon Network, Rapture,
Trouble, The Box, Nickelodeon, BET on Jazz
Classic Granada Plus, Carlton Food, UK Gold,
Performance, Discovery Home & Leisure
News and Documentaries Discovery, History Channel, CNN, National
Geographic, Travel Channel, Animal Planet
Contemporary Sci-Fi, Turner Classic Movies, Paramount
Comedy Channel, Granada Men & Motors,
Granada Breeze, Bravo, Living
</TABLE>

TELEPHONE TARIFFS. AS A RESULT OF OUR INVESTMENT IN OUR NATIONAL FIBER
BACKBONE NETWORK, WE ARE ABLE TO DESIGN AND OFFER INNOVATIVE TELEPHONE SERVICE
PACKAGES TO OUR CUSTOMERS. By integrating our national telecoms network with our
local networks, we are able to bypass a portion of the wholesale long distance
fees charged by BT and other carriers for carrying calls to and from our local
telephone networks. THIS INCREASED FLEXIBILITY ALLOWS US TO INTRODUCE MORE
VOLUME-ORIENTED AND/OR GEOGRAPHICALLY BASED CALLING PLANS DESIGNED TO GIVE THE
CUSTOMER EVEN GREATER CHOICE AND VALUE. AS AN EXAMPLE, WE RECENTLY LAUNCHED NTL
3-2-1, A PER MINUTE NATIONAL CALL TARIFF OF 3 PENCE DURING THE DAY, 2 PENCE
DURING THE EVENING AND 1 PENCE DURING THE WEEKEND. THE TARIFF IS DESIGNED TO
CHARGE CUSTOMERS A RATE WHICH IS AFFECTED BY WHEN THEY CALL, NOT WHERE THEY
CALL. INTERNET ACCESS IS 1P PER MINUTE OF USAGE AT ALL TIMES. The simplicity of
this telephone tariff provides us with a distinct pricing advantage over BT.
While BT offers its customers a series of complex discount plans, our 3-2-1
pricing structure offers a clear and simple savings formula for customers.

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

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RESIDENTIAL SERVICES

The following table compares our tariffs to BT's published tariffs.

BASE CHARGES

<TABLE>
<CAPTION>
OLD NEW
NTL BT BT*
----- ----- -----
<S> <C> <C> <C>
Line Rental.................................... L8.92 L8.92 L9.25
Call Set Up Fee................................ 3.5P 5.0p 5.0p
</TABLE>

TELEPHONE PER MINUTE CHARGES

<TABLE>
<CAPTION>
TELEPHONE TARIFFS
(PER MINUTE)
------------------
OLD NEW
NTL BT BT**
------- ------- -----
<S> <C> <C> <C>
Local
Daytime...................................... 3.00P 3.95p 4.00p
Evening...................................... 2.00P 1.50p 1.50p
Weekend...................................... 1.00P 1.00p 1.00p
Short National
Daytime...................................... 3.00P 7.91p 4.00p
Evening...................................... 2.00P 3.95p 4.00p
Weekend...................................... 1.00P 2.95p 2.00p
Long National
Daytime...................................... 3.00P 7.91p 4.00p
Evening...................................... 2.00P 4.18p 2.00p
Weekend...................................... 1.00P 2.95p 2.00p
</TABLE>

- ---------------
* Includes 180 minutes of weekend phone calling every three months.

** Effective October 1, 1999.

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

14
<PAGE> 16
RESIDENTIAL SERVICES

RESIDENTIAL MARKETING. We market our local telecoms and television service
as an integral part of the emerging information super-highway. This marketing
strategy is continually being refined and includes the following concepts in our
advertising, literature and other materials:

- POSITIONING US AS A LOCAL AND NATIONAL TELEPHONE COMPANY;

- INTRODUCING ALTERNATIVE TELEPHONE SERVICE, MULTI-CHANNEL TELEVISION AND
INTERNET ACCESS AS THE FIRST OF AN EXPANDING ARRAY OF SERVICES WHICH WILL
BE CARRIED ON THE NETWORK IN THE FUTURE; AND

- EMPHASIZING THAT WE ARE BRINGING "MORE CHOICE" IN TELEVISION VIEWING,
"BETTER VALUE" IN TELEPHONE SERVICE AND "STATE OF THE ART" COMMUNICATIONS
TECHNOLOGY IN PROVIDING ACCESS TO THE INTERNET;

We employ an extensive direct marketing and selling approach to gain
customers. We begin by building a relationship with our communities before
construction commences in a given area by closely coordinating our upcoming
activities with local government authorities and community groups and eliciting
feedback on ways to minimize disruptions and inconvenience. Information packages
and construction notices are delivered to the neighborhood prior to
construction. Our consumer affairs advisors personally visit affected
neighborhoods and households in order to meet the special needs of the
residents. All written and telephonic inquiries from residents are input by name
into a lead-tracking database, so that when areas are released to marketing, our
sales personnel have complete customer profiles of the residents in their
selling area.

We initiate our marketing in an area by direct mail, which is followed by a
personal appointment with a sales advisor. In some regions, the sales visit is
also preceded by the hand delivery to every household of a videotape that
describes us and our services. All information regarding both current and future
sales opportunities is entered into the database, and current sales information
is updated in our provisioning, billing and subscriber management system. Unsold
household data is maintained for future telemarketing, direct mail, and
re-marketing by the sales force.

Additionally, as part of our focus in ensuring and maximizing customer
retention, we usually charge an installation fee of L25.00. WE ADOPT A ONE YEAR
SERVICE AGREEMENT AND ENCOURAGE DIRECT DEBIT PAYMENT AS THE "STANDARD".
APPROXIMATELY 40% OF OUR CUSTOMERS ELECT DIRECT DEBIT AS A MEANS OF PAYMENT. The
installation fee and one year contract provide qualifying mechanisms to ensure
that the customer understands and recognizes the value of the services, while
the encouragement of direct debit payment helps to avoid non-payment or non-
payment related cancellations.

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

15
<PAGE> 17
RESIDENTIAL SERVICES

NON-CABLE CUSTOMERS. In 1998, we extended our service offerings beyond our
franchise areas in order to offer a set of alternative service options to over
12 million BT customers who are not passed by our local broadband networks. BY
UTILIZING OUR INVESTMENTS IN OUR NATIONAL TELECOMS NETWORK, OUR INTERNATIONAL
INTERNET FACILITIES AND OUR BACK OFFICE AND BILLING OPERATIONS, WE LAUNCHED A
SET OF PRODUCTS AND SERVICES THAT ALLOW US TO PROVIDE TELEPHONE AND INTERNET
SERVICES TO EVERY HOME IN THE UK WITH A BT TELEPHONE LINE AND A TELEVISION. A
graphical depiction of this network solution appears below.

[EDGAR GRAPHIC DESCRIPTION: Illustration of both a customer's telephone line
and internet television line leading directly into an NTL call router box,
which is shown to be connected to a BT line. The BT line is connected first to
a BT switch and then to an NTL switch, where the voice/telephony line is
directed to the NTL national network and the internet/data line is directed to
an NTL web server.]

THE NATIONAL CONSUMER SERVICES, OUR FIRST RETAIL OFFERING TO THE UK
CONSUMER OUTSIDE OUR FRANCHISE AREAS, HAVE ALLOWED US TO SIGNIFICANTLY INCREASE
OUR UK TARGET MARKET. WE CARRY THE CONSUMER'S TELEPHONE TRAFFIC VIA INDIRECT
ACCESS FOR VOICE AND INTERNET CALLS. USING INDIRECT ACCESS, THE CUSTOMER RETAINS
THEIR BT LINE, BUT THE CALLS ARE AUTOMATICALLY ROUTED TO OUR SWITCH AND NATIONAL
NETWORK. WE THEREFORE RECEIVE THE CALL REVENUE ASSOCIATED WITH THE CUSTOMER'S
VOICE AND INTERNET TRAFFIC. The "off-net" customer receives the benefit of our
3-2-1 pricing while we garner the revenues from their telephone calls.

In the future, we plan to provide digital television services over a
digital terrestrial television box that will form part of our National Consumer
Services product offering. DIGITAL TERRESTRIAL TELEVISION WILL ALLOW US TO OFFER
CUSTOMERS THROUGHOUT THE UK A BUNDLED OFFERING OF TELEPHONE, TELEVISION,
INTERNET AND INTERACTIVE SERVICES, THAT WILL MIRROR OUR IN-FRANCHISE PRODUCT
OFFERINGS. The bundle of services provides Internet access via the personal
computer or through our TV-Internet set top box which enables full Internet
access without the need to purchase a PC. Customers simply use a keyboard and
set-top box to access the Internet over their

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

16
<PAGE> 18
RESIDENTIAL SERVICES

television. This is an important market opportunity as it is estimated that of
the 24 million UK TV homes, over 18 million homes do not have an Internet
capable PC or Internet service.

NTL AND THE INTERNET

Internet use in UK homes, businesses and education is rising dramatically.
NTL regards data services as one of the three legs -- voice, data and
video -- upon which we have built the company. NTL provides Internet services
throughout the UK. Our subscribers can take advantage of the high data rates
provided by our fiber network in order to access the Net via a personal computer
or a television. NTL offers both consumer and business Internet services and
co-owns Virgin Net with Richard Branson. However, our involvement is not simply
based on enabling reliable Internet access. Rather, we also operate to support
the development of Internet applications and usage. We provide the backbone for
Virgin Net and Which? Online, with our call centers handling around 4,000 calls
a day for the two entities, consistently winning awards for speed of service and
customer satisfaction.

WE ARE PROUD TO HAVE BEEN RECOGNIZED AS THE:

- #1 ISP BY THE TIMES OF LONDON IN NOVEMBER 1998;

- "BEST INTERNET SERVICE PROVIDER OF 1997" BY WHAT PC? MAGAZINE; AND

- "BEST VALUE INTERNET SERVICE PROVIDER" BY WHICH? CONSUMER GUIDE, MAY 6,
1998.

For companies, NTL offers reliable and scalable solutions for connecting to
the Internet. These range from easy-to-connect dial up connections to fixed
access solutions for high volume, dedicated Internet connectivity. Furthermore,
our extensive and expanding network of entry points (POPs) guarantees rapid
access to the Internet at all times. Other Internet services available from NTL
include: firewalls, Web hosting, and virtual ISP.

For the growing number of companies who wish to move into becoming virtual
Internet service providers, NTL acts a wholesale provider. Furthermore,
companies are increasingly turning to NTL for electronic commerce solution too
and, as a result, our Internet services for businesses continue to grow. In all
these cases, we offer a unique set of assets:

- Networks

- Technology

- Customers

- Interactive Content

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

17
<PAGE> 19
RESIDENTIAL SERVICES

INTERNET ACCESS, INTERACTIVE SERVICES AND ENHANCED TELEVISION. We have
moved rapidly to take advantage of, and drive the convergence between the
Internet and the television. We are aggregating a broad range of interactive
content into a seamless service that can be deployed as part of our interactive
television services, such as TV-Internet and digital cable. Our decision to use
open Internet standards for these products has allowed us to rapidly integrate a
wide range of advanced technologies and partner with content companies who have
already developed sites for the Internet. BECAUSE WE HAVE BUILT OUR INTERACTIVE
SERVICE OFFERING IN OPEN INTERNET STANDARDS, OUR PLATFORM ALLOWS THESE CONTENT
SOURCES TO BE EASILY AND COST EFFECTIVELY INTEGRATED TO CREATE A
TELEVISION/ENTERTAINMENT EXPERIENCE RATHER THAN A COMPUTER-LIKE EXPERIENCE. This
includes using the NTL user interface to allow simple navigation by remote
control. In designing the look and feel of our interactive services, we built
upon the UK's familiarity with teletext services by allowing customers to use
the familiar four color remote control buttons to navigate through the
interactive screens. THESE ENHANCED SERVICES WILL ULTIMATELY BE DEPLOYED AS PART
OF OUR DIGITAL CABLE OFFERING WITHIN OUR FRANCHISE AREAS.

WE HAVE PARTNERED WITH OVER 40 CONTENT PROVIDERS TO DELIVER A WIDE RANGE OF
INTERACTIVE SERVICES, INCLUDING EDUCATION, HOME SHOPPING AND BANKING, TRAVEL,
ENTERTAINMENT, GAMES, NEWS, SPORT AND LOCAL CONTENT. Content is organized in
channels which include news, sport, travel, entertainment and retailing. Already
over 100 brands are contracted to the service. Partners include Tesco and The
Arcadia Group in the retail sector, ITN for news, the Sporting Life for sports
coverage and the BBC's Beeb service in entertainment. For example, the travel
channel allows viewers to search for travel destinations, gather destination
information and find travel deals from a large real-time database. In addition,
we are developing additional channels that will provide games, education and
financial and investment content. ALL PARTNERS HAVE CONTRACTED TO PROVIDE A
COMMISSION TO NTL ON E-COMMERCE TRANSACTIONS AND WE HAVE ALSO FORMED A JOINT
VENTURE TO EXPLOIT THE ADVERTISING OPPORTUNITY ASSOCIATED WITH THIS SERVICE.

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

18
<PAGE> 20
RESIDENTIAL SERVICES

THE NEXT STAGE IN THE DEVELOPMENT OF OUR CONSUMER PROPOSITION IS ENHANCED
TELEVISION SERVICES. Enhanced television is the use of interactive technologies
to enable television programs to become interactive. ENHANCED TELEVISION CAN BE
VIEWED AS A MODIFIED FORM OF INTERACTIVE SERVICES WHICH ARE CONSTANTLY "ON
SUPPLY" AS THE VIEWER WATCHES TELEVISION. Applications include the ability to
enable viewers to participate in game shows, access further information in
documentaries or respond directly to advertising. Viewers use their remote
controls to access the additional program information on demand. A graphical
representation of the enhanced TV system follows.

[EDGAR GRAPHIC DESCRIPTION: Illustration of the Enhanced TV Overall System
and technology partners. The illustration shows a box labeled 'Super Head-end',
which contains several smaller boxes, including boxes representing DiviCom,
Compaq, Magra, Ipsis and Microsoft, which are all interconnected and are shown
to feed into a ball labeled 'EPG data'. The Super Head-end box is shown to
receive external arrows, representing Programme Inputs, Corporate SMS and Call
Center information, interactive Partners and Internet Data. The EPG data,
connected to all the internal boxes, is shown to feed into the Existing NTL
National Network (ATM), which is shown to feed into the Regional Head-end,
containing a smaller DiviCom Multiplexing Out-of-bond data box. This Regional
Head-end box is shown to connect to a box labeled 'Set top box', which contains
the PACE logo, C-Cube Chip sets and Power TV Software.]

A major advantage of our cable technology is that these enhanced television
links are not restricted to information delivered in the broadcast stream, a
major restriction of satellite delivered services. A broad range of additional
content can be delivered over the cable modem integrated in the digital TV set
top box. We are working with a number of major broadcasters to develop the
service and have already demonstrated a number of program pilots.

Delivering enhanced television service requires close coordination between
the program creation and the technology of the broadcast system. Our digital
media center is being developed with the ability to schedule the television feed
and to add the interactive components to the broadcast feed.

These new technologies not only provide a powerful new set of tools for
television producers, but also create large new commercial opportunities for
operators like us in providing a unique service to help acquire and retain
customers with a package of communications services. In addition, we can exploit
new revenue opportunities from e-commerce generated by the interactive elements
and from interactive advertising on existing television services.

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

19
<PAGE> 21
RESIDENTIAL SERVICES

DIGITAL MEDIA CENTER. WE HAVE INVESTED APPROXIMATELY $60 MILLION IN A NEW
MEDIA CENTER WHICH IS AT THE HEART OF OUR DIGITAL OPERATIONS. THE CENTER ACTS AS
THE MARSHALING POINT FOR ALL DIGITAL CONTENT, BOTH TELEVISION AND INTERACTIVE.
Television and interactive services are brought to the center over satellite or
fiber telecommunication links. Currently a 55 channel near video on demand
service is produced using advanced digital storage and server technology. A
complete sports channel, British Eurosport, is originated in the media center.
In addition to the interactive television elements, conditional access for pay
TV and electronic program guide datastreams are created and played out from the
center.

The new media center also houses the interactive servers for on-demand
elements and is the point at which the broadband cable modem path is routed to
access the Internet. The interactive system, scheduling and conditional access
system are directly integrated with our customer management system. THIS ALLOWS
DIRECT CUSTOMER INTERFACE THROUGH THE TV SCREEN FOR BILLING, ON-LINE HELP OR
SELF-PROVISIONING OF NEW SERVICES. The system is controlled by a sophisticated
scheduling system and control room that monitors all channels. The resulting
service feed is carried from the center to each regional head using ATM
technology. This feed is then combined with local content, such as regional TV
channels for delivery over that local network. The system is capable of allowing
full flexibility of the regional line up of channels, for example to include
regional services from the major broadcasters, ITV, Channel 4 and the BBC.

The media center is connected to our UK national network and linked to our
satellite hubs for both in-bound and out-bound traffic. The system architecture
and flexibility allows the delivery of a customized service to any point
connected to our fiber telecoms network (for example, the current reach includes
Dublin which allows us to connect Cablelink's Dublin franchise to the center).
In the future, we plan to connect our French cable operations to the digital
media center, allowing us to further utilize our investment. This provides us
with a significant advantage in providing enhanced television in France, as we
won't need to duplicate our investment. This strategy can be duplicated in
additional European markets if we were to pursue additional cable opportunities
on the continent.

HIGH SPEED INTERNET SERVICE. In May 1999, we launched NTL HiSpeed
Internet, which links NTL's broadband cable network to the Internet at up to ten
times the speed of telephone. The new cable modem service operates at speeds of
up to 2.0 MBs and will be offered at a minimum delivery speed of 512 Kbps. Our
HiSpeed Internet will be an "always on" service, removing logging-on delays and
the need to log-off while using your telephone. IT ALSO UTILIZES OUR HYBRID
FIBER/COAXIAL CABLE TELEVISION PORTION OF OUR BROADBAND NETWORK, LEAVING THE
TELEPHONE LINE FREE TO MAKE OR RECEIVE CALLS. This service is currently priced
at a flat rate of L40 per month.

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

20
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RESIDENTIAL SERVICES

In addition, we are in the process of implementing a commercial pilot of
ADSL technology in parts of our Surrey franchise. ADSL can be particularly
attractive for us to install because we have very short copper telephone line
runs to our customers' premises which is critical for clear, efficient data
transport. Typically, our customer is within 500 meters from a node; whereas in
the United States, ADSL customers' premises may be more than 18,000 feet from
the end of the copper wire. ADSL is very easy for us to deploy and very
attractive to the customer particularly because it is:

- COST-EFFECTIVE -- less costly than a cable modem Internet connection

- RATABLE -- customers buy the amount of bandwidth they need; and

- SECURE -- it is a dedicated path, rather than the shared path of coax
cable.

VIRGINNET

In addition to telecoms and data services we also offer wholesale Internet
access solutions including network services, call center operations, customer
provisioning and billing to UK Internet Service Providers ("ISPs") and other
corporate customers that would like to expand their Internet presence. This
service was launched in 1995 as our first national product offering.

VIRGINNET RANKED # 1 BY THE TIMES OF LONDON

THE ALSO RANS:

- - AOL - FREESERVE
- - BT INTERNET - GLOBAL NETWORK
- - CABLE & WIRELESS - IBM
- - COMPUSERVE - NETCOM
- - DEMON - UUNET

SOURCE: THE TIMES OF LONDON, NOVEMBER 25, 1998.

In 1996, we established the VirginNet joint venture with Virgin Communications
Limited. As of August 31, 1999, VirginNet had over 400,000 customers. The joint
venture is 49% owned by NTL and 51% by Virgin. VirginNet offers connectivity and
proprietary content services to consumers and small businesses throughout the
UK. VirginNet recently launched a "free access" product offering, whereby
customers only pay for the minutes that they are online or in contact with a
customer care representative. WE ARE ABLE TO SUPPORT THIS SERVICE PROFITABLY
BECAUSE WE CARRY THE MAJORITY OF THE VIRGINNET INTERNET TRAFFIC ON OUR OWNED
NETWORK FACILITIES.

By integrating our Internet infrastructure with our national telecoms
network we have been able to decrease the costs of providing these wholesale
services as well as increase the value of the proposition by retaining a higher
portion of the revenue from the data traffic that our customers generate. We
plan to continue to enhance our Internet network, both nationally and
internationally, to accommodate the growth in the business.

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

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RESIDENTIAL SERVICES

OPERATING RESULTS

Based on trials and experiences in the UK and the prior experience of our
management in the United States telecommunications market, we have developed
innovative marketing strategies that have led to increased customer penetration
rates, customer retention and operating profitability.

As of March 31, 1999, pro forma for the acquisitions of ComTel, Comcast UK,
BT cable franchises, Diamond, "1G" Networks, Cablelink, and the proposed
acquisition of CWC ConsumerCo (but excluding our 50% ownership of Cable London
which Telewest exercised its option to buy in August 1999) we had 2.8 million
residential customers, approximately 51% of which subscribed to both telephone
and television services. Pro forma, the company counted a total of 4.3 million
revenue generating units (known as RGUs) resulting in approximately 37% customer
penetration, approximately 30% telephone penetration, approximately 29% cable
penetration, yielding 56% RGU penetration of homes marketed. An RGU is one
telephone account or one cable television account. A customer who takes
telephone and cable television service generates two RGUs.

NTL, ON A STANDALONE BASIS, PRIOR TO RECENT ACQUISITIONS, HAS ACHIEVED
INDUSTRY-LEADING CUSTOMER PENETRATION AND RETENTION LEVELS. OUR CATV PENETRATION
STANDS AT 45% WITH TELEPHONE PENETRATION AT 44%. THIS COMPARES FAVORABLY TO THE
UK INDUSTRY AVERAGE OF CATV PENETRATION OF 24% AND TELEPHONE PENETRATION OF 29%
ACHIEVED BY OUR COMPETITORS. SIMILARLY, NTL HAS EXPERIENCED AN ANNUAL TELEPHONE
AND CATV CHURN RATE OF APPROXIMATELY 12% VERSUS THE COMPETITOR CHURN RATE OF
APPROXIMATELY 27%.

NTL believes this success has been largely due to its focus on customer
service and the development of product offerings that emphasize choice, value
and simplicity. NTL plans to apply it marketing and customer service skills to
enhance the operational performance of the combined entity. NTL also expects to
achieve significant operating synergies from the combined operations including
economies of scale in content and equipment purchasing, reduced telephone
interconnect and call termination costs and improved operating leverage.

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

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<TABLE>
<CAPTION>
NTL ONLY(*)
-----------------------------------------------------
THE FOLLOWING TABLE ILLUSTRATES OPERATING PRO FORMA
STATISTICS OF OUR BROADBAND NETWORKS: NTL(4)
DECEMBER 31, JUNE 30, ---------
----------------------------------------- --------- MARCH 31,
1995 1996 1997 1998 1999 1999
------- ------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Homes passed(1)............... 463,000 779,100 1,007,000 1,247,000 1,312,500 8,463,000
Homes marketed (Telephone).... 176,200 467,300 810,000 1,064,600 1,123,600 6,984,000
Homes marketed (Cable)........ 176,200 467,300 810,000 1,064,600 1,123,600 7,713,000
Total customers(2)............ 57,700 168,200 321,300 471,000 516,300 2,852,000
Dual........................ 44,630 133,800 287,200 434,000 475,700 1,472,000
Telephone-only.............. 6,620 15,950 15,300 16,100 16,300 652,000
Cable television-only....... 6,450 18,450 18,800 20,800 24,300 729,000
Total RGUs.................... 102,300 302,000 608,500 905,100 992,000 4,324,000
Customer penetration.......... 33% 36% 40% 44% 46% 37%
Telephone penetration......... 29% 32% 37% 42% 44% 30%
Cable television
penetration................. 29% 33% 38% 43% 45% 29%
RGU penetration(3)............ 58% 65% 75% 85% 89% 56%
</TABLE>

- ---------------
(*) Excludes all acquisitions since January 1998.
(1) "Homes passed" is the expression in common usage in the cable industry as
the measurement of the size of a cabled area, meaning the total number of
residential premises which have the potential to be connected to our
network.
(2) As of December 31, 1998, we also provided service to approximately 19,400
customers connected to acquired cable systems over which we do not offer a
full range of services.
(3) RGU penetration is the number of RGUs per 100 homes marketed.
(4) Includes CWC ConsumerCo, Cablelink, Comcast UK, ComTel, Diamond Cable, BT
cable franchises. Excludes 50% ownership of Cable London which Telewest
exercised its option to buy in August 1999.

Consistent with our objectives, our high penetration rates have led to
increased levels of gross profit contribution per home passed and thus
increasing rates of return on invested assets. Our success has been consistent
as we have increased our penetration for 14 consecutive quarters as shown by the
following graph (excluding our recent acquisitions).

[EDGAR GRAPHIC DESCRIPTION: Line graph titled "Household Penetration" with
percentage penetration shown on vertical axis and quarters from first quarter
1996 to first quarter 1999 shown on the horizontal axis. Two lines on the graph
plot telephony and cable penetration for each quarterly period.]

<TABLE>
<CAPTION>
TELEPHONE CABLE
--------- -----
<S> <C> <C>
1Q96 28.9 29.0
2Q96 30.0 30.1
3Q96 30.6 30.9
4Q96 32.0 32.6
1Q97 32.9 33.4
2Q97 33.4 34.0
3Q97 35.9 36.4
4Q97 37.3 37.8
1Q98 38.1 38.5
2Q98 38.5 39.1
3Q98 40.1 40.6
4Q98 42.3 42.7
1Q99 43.0 43.7
2Q99 44.0 45.0
</TABLE>

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

23
<PAGE> 25
RESIDENTIAL SERVICES

The quality of our customer's experience is further evidenced by the
results published by OFTEL. These results are exhibited in the following table
and charts and highlight our improved performance over BT and our peers in a
number of measures which effect the quality of our residential customer's
experience.

NTL VS BT
[EDGAR GRAPHIC DESCRIPTION: RESIDENTIAL CUSTOMERS BAR CHART]

<TABLE>
<CAPTION>
BT NTL
-- ---
<S> <C> <C>
Faults Cleared 79.90 98.10
Reported Faults per 100 Lines 4.10 2.30
</TABLE>

NTL AND ITS PEERS

<TABLE>
<CAPTION>
RESIDENTIAL CUSTOMERS
1998
------------------------
NTL TELEWEST CWC
---- -------- ----
<S> <C> <C> <C>
Faults Cleared.............................................. 98.1% 88.3% 75.7%
Reported Faults per 100 lines............................... 2.3 4.5 6.6
Orders Completed............................................ 97.7% 90.4% 83.2%
</TABLE>

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

24
<PAGE> 26
RESIDENTIAL SERVICES

INDUSTRY STATISTICS

Our industry has demonstrated strong growth over the last several years.
THE INDUSTRY HAS NOW PASSED APPROXIMATELY 12 MILLION HOMES (OR 50% OF THE UK'S
TOTAL TV HOMES) WITH A BROADBAND COMMUNICATIONS NETWORK. PRO FORMA FOR OUR
RECENT AND PROPOSED ACQUISITIONS, WE HAVE PASSED OVER 8 MILLION HOMES. AS A
RESULT, THE UK CAN CLAIM TO HAVE ONE OF THE MOST ADVANCED COMMUNICATIONS
INFRASTRUCTURES IN THE WORLD. In addition, since January 1, 1992, the industry
has connected approximately 4.5 million telephone lines. (During the same
period, BT has also grown, adding approximately 2.5 million telephone lines.)
The following tables illustrate these statistics:

<TABLE>
<CAPTION>
TELEPHONE LINES
-----------------------------------------------------------------------------
RESIDENTIAL
RESIDENTIAL AND BUSINESS RESIDENTIAL TELEPHONE LINE
TELEPHONE LINES TELEPHONE LINES HOMES PASSED PENETRATION
------------------------ --------------- ------------ --------------
<S> <C> <C> <C> <C>
June 30, 1999................ 4,571,274 3,993,215 12,171,351 33%
January 1, 1999.............. 4,070,866 3,567,786 11,904,341 30%
January 1, 1998.............. 3,442,196 3,038,809 10,693,809 28%
January 1, 1997.............. 2,278,113 2,039,081 8,351,310 24%
January 1, 1996.............. 1,419,819 1,287,248 6,042,296 21%
January 1, 1995.............. 717,566 649,350 4,116,971 16%
January 1, 1994.............. 314,381 279,728 2,786,202 10%
January 1, 1993.............. 106,989 92,715 1,954,829 5%
January 1, 1992.............. 21,225 N/A 1,343,557 --
</TABLE>

BSKYB SUBSCRIBERS

<TABLE>
<CAPTION>
TOTAL TOTAL DTH DTH
CUSTOMERS DTH HOMES AS A % OF TOTAL NET ADDITIONS
--------- --------- --------------- -------------
<S> <C> <C> <C> <C>
June 30, 1999........................... 7,442,000(1) 3,460,000 46.5% (87,000)
June 30, 1998........................... 6,899,000 3,547,000 51.4% 15,000
June 30, 1997........................... 6,372,000 3,532,000 55.4% 285,000
June 30, 1996........................... 5,022,000 3,247,000 64.7% 354,000
June 30, 1995........................... 4,163,000 2,893,000 69.5% 352,000
June 30, 1994........................... 3,477,000 2,541,000 73.1% --
</TABLE>

- ---------------
(1) Includes 589,000 and 204,000 Eire and ONDigital customers, respectively at
June 30, 1999.

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

25
<PAGE> 27

BUSINESS SERVICES

NTL's business and nonresidential services have undergone a significant
transformation in the last twelve months, as the company has moved away from a
simple product-based sales approach to a sector-based approach. IN THE BUSINESS
MARKET (COMPRISED OF GOVERNMENT, INDUSTRY, HEALTH AND EDUCATION SECTORS) THIS
SECTOR APPROACH ENABLES US TO PROVIDE A BROAD ARRAY OF SERVICES RANGING FROM
SIMPLE CONNECTIVITY FOR SMALL BUSINESSES TO INTEGRATED SOLUTIONS OF VOICE, VIDEO
AND DATA FOR LARGE ENTERPRISES. These services are provided on local, regional
or national bases to more than 60,000 businesses. Our communication products are
appealing because of our highly reliable network services. In the business
market our reported faults (as compiled by the regulator, Oftel) are 1.3 per 100
lines as compared to 3.3 per 100 lines, for B.T., a statistically significant
difference. In addition to our ability to package several services together at
attractive prices, we have a strong local market presence due to the
localization of our staff and support services.

In recognition of the developing needs and concerns of our large customers,
NTL recently acquired Workplace Technologies, one of the UK's leading data
network service consultancy integrators. Workplace's services range from the
design and installation of data, voice and video networks to remote monitoring
and support of these networks. Workplace currently employs 500 people in the UK.
We believe that large customers are more interested in functionality of voice,
video and data needs rather than driven by cost concerns. The combination of
network capability, ISP experience, and the market presence of NTL enables us to
offer a unique and comprehensive service to large customers.

BUSINESS PRODUCTS AND SERVICES.

- - SIMPLE "ACCESS" SERVICES that connect the customer to us for inbound and
outbound voice and data calls. These access services include traditional
analog Business Exchange Lines (BELs) and Digital Business Exchange (DELs).
DEL services include Basis Rate Access, also known as "ISDN2", and Primary
Rate Access, also known as "ISDN30". These and other direct and indirect
access services are priced competitively and offered in competition with a
number of other direct and indirect suppliers.

- - MANAGED VOICE SERVICES are best illustrated by our Central Exchange "Centrex"
service. This service presents the customer with business exchange lines
configured as a "virtual PABX", as we completely handle the services normally
associated with a traditional PABX (or PBX). THE SUCCESS OF THIS PRODUCT IS
WELL DEMONSTRATED IN THE EAST MIDLANDS WHERE EIGHT OF THE 11 LOCAL GOVERNMENT
ORGANIZATIONS USE NTL CENTREX AS THEIR MAIN BUSINESS SERVICE, INCLUDING THE
NOTTINGHAM CITY COUNCIL WITH MORE THAN 3,500 LINES.

- - MANAGED DATA SERVICES include fixed point-to-point private circuits at speeds
from 64 Kbit/s, through multiples of that speed and individually tailored 100
Mbit/s and 155 Mbit/s services. Other services include the provision of
intersite data services with particular transmission protocols, such as
Internet Protocol also known as TCP/IP, Frame Relay and ATM.

- - INTERNET SERVICES provided by NTL ranges from "Dial-up" customers to dedicated
private circuits for greater access speeds. We are launching a range of new
services and branded hardware products, which include both entry level and
advanced "firewalls", and a self provisioning web-hosting service. We own an
interest in and provide communications network and back office support for
Virgin Net and provide services to more than twenty other Internet Service
Providers.

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

26
<PAGE> 28
BUSINESS SERVICES

LOCAL BUSINESS SERVICES. The local business telecoms market provides an
interesting and attractive opportunity to NTL. FOR THE MOST PART, THE UNDERLYING
CAPITAL INVESTMENT NEEDED TO ADDRESS THIS MARKET IS MADE THROUGH THE BUILDOUT OF
THE NETWORK FOR THE RESIDENTIAL MARKET IN OUR FRANCHISED AREAS. THEREFORE, THE
MAJORITY OF THE CAPITAL INVESTMENT REQUIRED TO ADDRESS THE BUSINESS ENVIRONMENT
IS "SUCCESS DRIVEN" CAPITAL. A good example of this principle is the provision
of telecommunications services at Luton Airport, just north of London, to two
airlines -- EasyJet and Monarch Airlines. Due to the completed NTL residential
fiber network surrounding the airport, we were able to interconnect each of
Monarch buildings with a 10 Mbs local area network by merely "pulling fiber"
into the airport. Subsequently, we have provided Monarch with ISDN, Centrex and
basic telephone services.

[EDGAR GRAPHIC DESCRIPTION: Illustration of Luton Airport 10 Mbs local area
network. The Easy Jet Airport Terminal is shown extending to the Monarch
Airlines Ethernet that connects five buildings. Surrounding the airport are
homes representing the NTL residential fiber network that provided the
foundation for interconnecting the Monarch buildings.]

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

27
<PAGE> 29
BUSINESS SERVICES

NTL's responsiveness to our customer needs is demonstrated by our ongoing
relationship with Easyjet. Based at the Luton airport, Easyjet is a very
entrepreneurial budget airline which carries 1.5 million passengers to and from
destinations, including Amsterdam, Nice, Barcelona, Edinburgh, Glasgow,
Aberdeen, and Inverness. The airline succeeds on a low price, no frills, no
tickets, scheduled flight service. Customers just show up, check in, board and
take off. All seat sales are transacted by telephone, which is where NTL comes
in. In March 1997, Easyjet needed an urgent Centrex order fulfilled in order to
cope with response to a national newspaper campaign which resulted in over
100,000 telephone calls coming into Easyjet's Luton call center. NTL fulfilled
two separate orders -- 24 hours apart -- for an E-1 (30 lines) essentially on an
overnight basis. Clive Just, Manager of IT services at Easyjet, commented:

"IT WAS ONE OF THE NEWSPAPER'S LONGEST EVER PROMOTIONS, SPANNING THREE
WEEKS, IN WHICH READERS COLLECTED TOKENS [COUPONS] AND CALLED IN FOR
SEATS AT L14.50 [$23]. AT ONE POINT IT WAS ESTIMATED THAT 100,000
PEOPLE WERE TRYING TO CALL US WITH POSSIBLY FIVE TIMES THAT NUMBER OF
PEOPLE WHO WERE UNABLE TO GET THROUGH TO THE NETWORK.

WHEN WE REALIZED WE NEEDED TO EXPAND THE NUMBER OF TELEPHONE CALLS WE
COULD HANDLE, ONE LEADING COMPANY WAS TALKING WEEKS FOR DELIVERY,
NUMBER ONE (BT) WAS TALKING MONTHS AND NTL WAS TALKING DAYS. WE WANTED
THE LINES QUICKLY AND NTL WAS ABLE TO DELIVER. IT WAS ALSO CHEAPER."

"WE DID ENCOUNTER A FEW TECHNICAL PROBLEMS AND NTL ALWAYS RESPONDED
EXTREMELY QUICKLY -- EVEN IF THE PROBLEM WAS NOT WITHIN THEIR NETWORK.
WE HAVE DIRECT ACCESS TO A DEDICATED ENGINEER WHO KNOWS US AND OUR
OPERATION IN DEPTH.

NTL HAS BEEN VERY KEEN TO EXPERIMENT AND MOVE EASYJET INTO NEW AREAS.
ONE ILLUSTRATION OF THIS APPROACH IS THE JOINT TRIALING OF A SCHEME
[PROCEDURE] IN WHICH THE EASYJET TELEPHONE SALES OPERATORS WORK FROM
HOME USING NTL'S CENTREX SYSTEM."

However, subsequent to March 1997, NTL has received 13 additional orders
for ISDN, Centrex, and digital telephone lines. That is the hallmark of a
satisfied customer.

<TABLE>
<CAPTION>
EASYJET
ORDER DATE
- ------------------------------------
<S> <C> <C>
10/96 1/98 4/99
10/96 1/98 4/99
1/97 10/98 5/99
3/97 10/98 5/99
7/97 12/98 5/99
8/97 2/99 7/99
10/97 3/99 9/99
</TABLE>

REGIONAL BUSINESS SERVICES. The communications services we provide to the
education and government sectors is an excellent example of the possibilities
created by our newly built high bandwidth networks where we can provide both
region wide and intra-regional connectivity. We provide extensive services to
numerous local governments, particularly our Centrex service that eliminates the
need for a PBX, simplifies moves, adds and changes and provides free calling
between locations. Additionally, our focus on the education market is
demonstrated by the more than 3000 primary schools, colleges and universities we
serve; the majority of which

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

28
<PAGE> 30
BUSINESS SERVICES

we connect to the Internet with speeds ranging from 128 Kb to 2 MB speed.
Funding for the Internet segment of the services has been largely provided by
the Government, for whom Internet connectivity has become a high priority.

- - REGION-WIDE BUSINESS SERVICES. IN HERTFORDSHIRE, NTL PROVIDES COUNTY-WIDE
TELECOMMUNICATIONS FOR ALL THE LOCAL SCHOOLS AS WELL AS WIDELY DISPERSED
MUNICIPAL ADMINISTRATIVE OFFICES. NTL was awarded all of Hertfordshire County
Council's voice and data traffic and installed Centrex across all of the
Council's sites (upward of 500 Centrex lines) based upon an integrated solution.
These sites included libraries, social services offices and environmental
services offices all linked to an NTL-provisioned voice and data call center.

In addition to providing county-wide municipal council service in
Hertfordshire, NTL provides a customized package of Internet and telecom
services to all schools county-wide. The service, known as the "Hertfordshire
Learning Grid", inaugurated one of the largest Internet and Intranet projects in
the UK education sector. NTL installed, maintains and manages PCs at all primary
schools. NTL arranged to train three teachers in each school on how to use the
Internet for communication, i.e. email, how to use the Intranet for their
administration, and how to use the world wide web to gather information which
would support the teachers and help them to teach the children. Additionally,
NTL built a bespoke intranet service for both the council's administration and
schools which entailed a help desk, an email filtering system, Internet
filtering, and Intranet filtering. The complete solution is fully managed by NTL
and completely seamless to the customer. All queries are managed by their
respective NTL local account manager.

- - INTRA-REGIONAL BUSINESS SERVICES. WITHIN REGIONS, NTL HAS OVERLAID DEDICATED
HIGH CAPACITY VIRTUAL PRIVATE NETWORKS (VPNS) ON ITS PREVIOUSLY CONSTRUCTED
INTRAFRASTRUCTURE. An excellent example of a VPN is the provision of 155 MB
metropolitan area networks (MAN) in a number of our regions throughout the UK to
support SuperJANET. The UK Government established the Joint Academic Network
(JANET) in order to facilitate a sharing of knowledge and research among all UK
universities and other government-funded research facilities. SuperJANET is the
broadband, or high speed, portion of JANET. A good example is the SuperJANET
network in South Wales (SWAN). SWAN provides the gateway to SuperJANET for 23
institutions of higher learning in Wales. SWAN is a 60 mile fiber network,
connecting with 13 sites which serve approximately 16,000 PC's, creating
approximately 2 million e-mails and 12 million hits on the World Wide Web every
month. As Dr. John Martin, Chairman of the South Wales MAN Board, commented:

"THE REASON WE CHOSE NTL WAS BECAUSE THEY WERE BY FAR THE MOST
IMAGINATIVE IN THE WAY THEY BID. IT WAS CLEAR THAT THEY HAD TAKEN TIME TO
THINK ABOUT WHAT WE NEEDED AND THEY OFFERED US A SET OF TARIFFS THAT WERE
INDEPENDENT OF DISTANCE AND BANDWIDTH. THEY WERE THE ONLY ONES TO PROPOSE
155 MEGABITS PER SECOND CIRCUITS FROM THE OUTSET"

- - NATIONAL BUSINESS SERVICES. Our national network (see inside front cover)
was designed specifically to connect our local networks and enable distance
insensitive calling tariffs. ADDITIONALLY, WE DERIVE SUBSTANTIAL INCREMENTAL
REVENUES BY PROVIDING TELECOMMUNICATION SERVICES TO OTHERS. We estimate that our
national network covers approximately 3,500 route miles and 170,000 fiber miles
across England, Scotland and Wales. During 1998, we extended the network to
include the first resilient fiber connection between Northern Ireland, the
Republic of Ireland, Scotland and England. In addition, in December 1998, we
acquired Eastern Group Telecom, or EGT, which expanded our network to cover
southeast England. Our national network has been designed with significant
excess capacity. FOR EXAMPLE, THE TRUNK ROUTE SPECIFICATION PROVIDES FOR TWO
LARGE

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

29
<PAGE> 31
BUSINESS SERVICES

DUCTS, EACH WITH CAPACITY FOR 4 SUB-DUCTS, ONLY ONE OF THOSE EIGHT SUB-DUCTS IS
CURRENTLY USED. OUR TOTAL DUCT CAPACITY EXCEEDS 2300 FIBERS OF WHICH ONLY A
SMALL PORTION IS "LIT".

Our national network is a fully redundant, SDH digital fiber network. The
major fiber routes are complemented by microwave radio connections which
increase the reach of the network. SDH technology improves network reliability
and performance and provides greater flexibility than conventional transmission
architecture. In addition, network availability, management and routing are also
superior to conventional transmission architecture because signals are
automatically rerouted to the best path available if another is severed or
degraded. WE BELIEVE THAT WE HAVE A COMPETITIVE ADVANTAGE OVER OTHER CARRIERS
SUCH AS BT BECAUSE SDH TECHNOLOGY HAS BEEN BUILT INTO OUR NETWORKS FROM THE
START, THUS AVOIDING INTEGRATION PROBLEMS WITH OLDER NETWORK TECHNOLOGIES.

An important source of revenue for NTL is the bandwidth and connectivity we
provide to other communications carriers. Our network is used to interconnect
these carriers to cities throughout the UK and Ireland. NTL provides customers
with capacity ranging from 2 Mbits to STM-16's. OWNING CORE INFRASTRUCTURE ALSO
OPENS UP AVENUES FOR INTERNATIONAL NETWORK EXPANSION. INCREASINGLY, NETWORK
OPERATORS ARE LOOKING AT MINIMIZING CAPITAL OUTLAY BY SWAPPING CAPACITY ON THEIR
INFRASTRUCTURE FOR NEW NOTES OR ADDITIONAL CAPACITY ELSEWHERE. Our customers
include fixed wireline and mobile telecommunications operators, cable operators,
Internet service providers, and various information technology and facilities
management companies, notably.

- - COLT where we have been awarded 'preferred supplier" status for the
distribution of COLT's traffic outside the London area. This covers bandwidths
from 2 Mbits to STM-1.

- - ENERGIS for which we provide high speed managed services to enable the
operator to more effectively address its 'off-net' customer base.

- - GLOBAL ONE where as part of this international operator's roll-out, we are
providing managed services between London and Dublin utilizing our recently
completed sub-sea cable.

- - VODAFONE AND ORANGE, for which we provide inter-switch capacity on our
national network. During 1998, both Vodafone and Orange considerably increased
their requirements for network services, and as of December 1998, we supplied
Orange with the majority of its inter-switch capacity.

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL fiber and coaxial cable and
telephone wires for Business and Home customers. The telephone cables appear at
the bottom right of the page.]

30
<PAGE> 32

BROADCAST AND TOWER SERVICES

We are a leading owner and operator of broadcast and transmission and
wireless communications infrastructure in the UK and Australia. AS OF JUNE 30,
1999 AND AFTER GIVING EFFECT TO THE ACQUISITION OF NTN IN AUSTRALIA, WE OWN OR
SHARE APPROXIMATELY 2,019 TOWERS AND SITES, OF WHICH 1,458 ARE IN THE UK AND 561
ARE IN AUSTRALIA.

We provide a number of services;

- TELEVISION AND RADIO BROADCAST TRANSMISSION

- TOWER AND SITE LEASING

- RADIO COMMUNICATIONS SERVICES

Based on our track record of more than 40 years of providing broadcast
services to the UK's independent television operators and our expertise in
digital broadcasting, we believe that we are uniquely positioned to capitalize
on the trends towards privatization and digitalization in the global
broadcasting industry. Our strategy is to replicate our success in the UK
through obtaining broadcasting franchises in other countries.

UK BROADCAST TRANSMISSION

NTL HAS BEEN INVOLVED IN BROADCAST TELEVISION SINCE THE 1950'S WHEN WE
DESIGNED AND BUILT THE TELEVISION TRANSMISSION SYSTEM FOR THE UK'S FIRST
INDEPENDENT COMMERCIAL TELEVISION NETWORK. The Broadcast Transmission Group
operates a national infrastructure in the UK of over 1,300 transmission sites
delivering broadcast signals for the three commercial national television
channels and many of the UK's independent local, regional and national radio
broadcasters. Additionally, the group designs, installs, operates, and maintains
new transmitter networks and has a spectrum planning service to monitor the
coverage of television and radio networks.

The Broadcast Transmission group provides a recurring contracted revenue
stream from these customers through long term contracts. The projected total
value of our present contracts for broadcast services is $1.8 billion with some
contracts extending until 2012. AN ATTRACTIVE FEATURE OF THE NTL BROADCAST
CONTRACTS IS OUR OWNERSHIP OF BOTH TOWERS AND TRANSMISSION EQUIPMENT RESPONSIBLE
FOR GENERATING THE BROADCAST SIGNAL. In essence, TV and radio station owners are
programmers and NTL is the broadcaster. The nature of these arrangements is such
that there are significant switching costs for any TV broadcaster wishing to
change service provider. The barriers to entry a new provider would need to
overcome include:

- The provisioning of capital equipment for transmission services and
studio coding, decoding and distribution circuits;

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL transmission tower.]

31
<PAGE> 33
BROADCAST AND TOWER SERVICES

- Re-engineering of network either around NTL sites or, more challenging,
around a different set of sites. In the latter case, planning permission
would be particularly difficult to receive for an alternative set of
large transmitter sites;

- Attaining spectrum for a differently engineered network as there is a
broadcast spectrum shortage.

TELEVISION BROADCASTING. We currently provide digital broadcast
transmission for Channel 3 and Channel 4/S4C and analog broadcast transmission
services for the three commercial national television channels in the UK, ITV,
Channel 4/S4C and Channel 5.

IN NOVEMBER 1998 WE ATTAINED BROADCAST HISTORY WITH THE LAUNCH OF THE FIRST
COMMERCIAL DIGITAL TERRESTRIAL TELEVISION NETWORK. Two of the four recipients of
the digital terrestrial television (DTT) multiplexes, Digital 3 and 4 and SDN
(in which we hold a 33% equity interest) selected us as the supplier of
transmission services. At the launch of DTT there were 22 transmitting stations
with a rollout plan targetted at reaching 85% population coverage. As of October
20, 1999, there were 24 transmitting stations. We have not only successfully
completed the first phase of the build program from playout centers to
transmission in a timely fashion but have also signed 12 year contracts to
provide end to end service, including studio compression, transmission and full
systems integration. It is anticipated that the digital network will ultimately
grow to match coverage from the analog system to enable its switch-off.

Digital broadcast systems require a more complex engineering design than
their analog predecessors. We have exploited this by extending our range of
services to include tower leasing and transmission services (as with analog)
plus "end to end" system integration and service ranging from studio playout
centers to terrestrial transmission. This has the twin benefits of enlarging the
total market available from broadcasting and further differentiating us as a
unique provider able to offer towers, transmission and system integration
services for digital television.

RADIO BROADCASTING. The Broadcast radio market in the UK comprises the
publicly funded BBC and the commercial radio industry. The BBC operates five
national radio networks and 44 local radio stations. All non-BBC radio in the UK
is regulated by the Radio Authority, who currently licence 3 national commercial
stations (such as Virgin and Classic FM) and 220 metropolitan, regional and
local stations. Despite this diversity, ownership concentration is high, with 5
or 6 major groups controlling the majority of stations.

Commercial radio stations are free to contract with any supplier for their
transmission needs. WE HAVE AN 85% SHARE BY VALUE OF THE LOCAL COMMERCIAL RADIO
TRANSMISSION MARKET AND A 40% SHARE BY VALUE OF THE NATIONAL COMMERCIAL MARKET.

We also offer a range of services to local and national radio broadcasting
licensees in the UK including: target service area planning; site location,
installation and construction; and equipment selection, procurement, operation,
monitoring and maintenance. This division offers total broadcast contract
services, where it designs,

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL transmission tower.]

32
<PAGE> 34
BROADCAST AND TOWER SERVICES

builds, owns and maintains the operator's transmission facilities, and facility
management contract services where it maintains customer-owned equipment and
administers the operation of the transmission service.

The migration to a new digital transmission platform will create
significant growth in the broadcast radio transmission market. The Radio
Authority is committed to a fast roll-out of the new digital multiplex licenses
and has already awarded the only national licence to Digital One, of which we
are a founding equity partner with a 33% equity interest. We have a contract for
the transmission of Digital One with a lifetime value in excess of $75 million.
A total of 26 licenses for regional and local digital radio will be awarded
between 1999 and 2001, and we are well positioned to win transmission contracts
for a portion of the licenses, and provide site leasing services associated with
some of the remaining licenses.

AUSTRALIAN BROADCAST TRANSMISSION

WE RECENTLY PURCHASED NTN, THE EXCLUSIVE PROVIDER OF TELEVISION AND RADIO
TRANSMISSION SERVICES TO AUSTRALIA'S ONLY NATIONAL TV AND RADIO BROADCASTERS,
ABC AND SBS. In addition, NTN serves regional and community TV and radio
broadcasters and providers equipment hosting services to telecom operators and
emergency service communications on its towers. NTN's customers include Telstra,
WIN Television, Prime Television, Vodafone and Air Services Australia. NTN holds
long term contractual relationships with the majority of its customers. NTN owns
561 tower sites throughout Australia.

Our strategy for NTN is to develop and exploit numerous opportunities
including:

- Introduction of digital terrestrial television broadcasting from 2001;

- Introduction of digital radio broadcasting and datacasting;

- Generating higher revenues from the provision of transmission site rental
and services to non-broadcast services, such as cellular carriers;

- Develop advanced radio communications services for Emergency Services,
based on TETRA technology.

THE TOWER AND SITES DIVISION

As of June 30, 1999, over 300 companies rented antenna space on our towers
and sites. These site rental agreements have terms which are typically 10 years
in length (and renewable), and are generally subject to price indexation with
inflation. Site sharing customers are typically billed a year in advance. DURING
THE LAST 4 YEARS, THE NUMBER OF LESSEES ON OUR TOWERS HAS GROWN BY 63%, FROM
1,989 TO OVER 4,000.

The cellular market is the largest of these markets in terms of users,
coverage, and usage of radio sites, and is witnessing extraordinary growth.
Current build plans of UK cellular operators would indicate a doubling of the
number of base stations built to meet the increased demand over the next 3
years.

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL transmission tower.]

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BROADCAST AND TOWER SERVICES

Cellular growth will necessitate reliable communications infrastructure in
all commercial areas, leading to a requirement for good cellular coverage inside
buildings. We believe this creates a new type of radio site, which unlike towers
will exist within commercial buildings, transport hubs, shopping malls and other
large buildings. Our initial analysis shows that there are approximately 2,000
large retail, transport or other multi-tenanted commercial properties in the UK
that may require communications infrastructure to facilitate mobile telephony.
To this end we have won the exclusive contract to provide this service inside
Bluewater, Britain's largest and newest shopping complex.

AGAINST THE BACKDROP OF PROJECTED DEMAND FOR SUITABLE RADIO SITES, THE UK
PLANNING/REGULATORY ENVIRONMENT IS INCREASINGLY ENCOURAGING SITE SHARING TO
PREVENT PROLIFERATION OF SINGLE-USER TOWERS. Intense price competition in the
cellular market is leading to out-sourcing opportunities as the network
operators look to achieve broad and deep coverage without developing significant
single-user tower portfolios.

As of September, 1999, we own or share 1,458 towers and sites in the UK.
Our inventory of owned and shared towers and sites was increased substantially
from 1995 to today as a result of the following transactions.

- In 1995, we embarked on a contract to build network for UK PCN operator
"one2one." As part of this contract, we acquired approximately 240
cellular sites, with one2one as anchor tenant.

- In May 1998, we purchased 114 sites from Simoco Group. This portfolio was
originally developed as part of the Phillips PMR business, the sites
being strategically located across the UK in hilltop locations ideally
suited to PMR VHF systems.

- In December 1998, we acquired 126 sites as part of the purchase of all of
the business and assets of Eastern Group Telecom (EGT). These sites
included the right to develop up to 1,000 more locations of Eastern Group
property for site sharing purposes. Overall, we believe that this
portfolio has been developed for good cellular telephone coverage.

RADIO COMMUNICATION SERVICES

Our RadioComms division is involved in mobile communications maintenance,
support and facilities management. This enables us to offer customers the
optimum solution to their requirements, from equipment specific component
repair/replacement, to full turnkey site and equipment maintenance.

The group offers a full range of services, including the operation of radio
networks and the provision of support and maintenance services to customers with
"mission critical" radio communications needs. WE SERVE A SUBSTANTIAL PORTION OF
THE RADIO INSTALLATION AND MAINTENANCE MARKET FOR PUBLIC SAFETY SERVICES WITHIN
ENGLAND AND WALES AND ASSOCIATED CUSTOMERS SUCH AS HM PRISON SERVICE AND HM
COAST GUARD. These customers provide us with a steady source of revenues, and
have also proven to be very effective references for other services and
products.

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL transmission tower.]

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BROADCAST AND TOWER SERVICES

We intend to secure further customers and contracts, expanding from
facilities and maintenance activities into complete outsource arrangements. We
have positioned ourselves to effectively compete in the major growth sector in
the radio communications market over the next five years by targeting both
public and private mobile operators. Several large contracts of this type are
under bid process in 1999, with contract awards expected within a year.
LONG-TERM CONTRACTS (TYPICALLY GREATER THAN FIVE YEARS) OF THIS NATURE, IF
AWARDED TO US, ARE EXPECTED TO SUBSTANTIALLY INCREASE THE REVENUE PROFILE OF THE
GROUP AND HELP US MAINTAIN OUR OVERALL REVENUE STABILITY.

KEY TRENDS IN THE TOWERS AND SITES MARKETS

There are a number of key market trends that are creating opportunities for
us to expand and grow our Broadcast Transmission and Tower Services businesses:

- Digital terrestrial broadcast services will gradually replace their
analog predecessors, resulting in major new services with operators
running in parallel and in competition with existing analog services. The
launch of digital terrestrial television services will ultimately require
the creation of an entire national broadcast network of approximately
1,200 sites to serve the UK population.

- The increasing global trend towards private rather than state ownership
and operation of television and radio broadcast transmission networks.
The outsourcing of these networks will result in new business
opportunities for us.

- The continuation of the rapid growth of UK cellular mobile telephone with
greater than 60% annual growth in subscribers for current services.
According to published reports, mobile subscribers have grown from 9.9
million in August 1998 to 17.5 million in August 1999, or approximately
29.7% of the population of the UK. The rapid growth in mobile subscribers
has increased demand for antenna space and tower sites.

- The rollout of new wireless communications technologies, such as PCN and
digital Terrestrial Trunked Radio (known as TETRA) and granting of five
licenses in the UK for 3rd generation Universal Mobile Telephone Service
(known as UMTS mobile) in early 2000 will further enhance demand for
antenna space and tower sites.

- The continuing liberalization of the telecommunications market, causing
proliferation of radio fixed links as the most economic and quickest
method of establishing competition within the local loop. These links
will be driven by competition for local loop traffic, high bandwidth WANs
and core network for newly licensed PTOs. This will also enhance the
demand for antenna space and tower sites.

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL transmission tower.]

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BROADCAST AND TOWER SERVICES

- The growing utilization of wireless delivery to the commercial market in
order to extend bandwidth to all possible locations. There is a
developing market for wireless delivery where fiber is not currently
available or practical to be delivered. Currently NTL uses its towers to
serve commercial customers such as the Sere Motor Group. Sere has four
locations in Belfast; three of which are served by our fiber in the
ground while the fourth location is in a wireless tower service area.

Illustrations of the current use of our tower infrastructure to connect our
network to customers follow:

[EDGAR GRAPHIC DESCRIPTION: SERE Motor Group, Northern Ireland, CENTREX Network

Illustration of three customer locations connected to a switch. The switch is
shown as connected to an NTL transmission tower which is shown as connected by
'wireless fibre' to another location.]

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL transmission tower.]

36
<PAGE> 38

CONCLUSION

The rapid changes and developments in the communications industry over the
last 20 years indicate that new entrants can achieve a 50% market share. This
has been adequately demonstrated by new entrants in the long distance market in
the United States and Germany as well as by the worldwide development of the
cellular industry. Furthermore, competition leads to lower prices for the
consumer while simultaneously causing the incumbent provider to raise his
standards of service. It is also noteworthy that a positive elasticity of total
demand exists for communication services. For example, in the US in the long
distance industry, revenues grew from $20 billion to $80 billion as prices
declined by approximately 65%. In the United Kingdom, our primary geographic
focus, new entrants are gaining market share but the telecoms industry is
growing so rapidly that BT is not affected.

TOTAL TELEPHONE LINES IN SERVICE IN THE UNITED KINGDOM (000s)

<TABLE>
<CAPTION>
DEC '92 JUN '99

------- -------
<S> <C> <C>
NTL AND COHORTS 120 4,500
BT 26,000 28,000
</TABLE>

Seemingly, new entrants gain market share simply by "setting up shop".
However, the ultimate ability to create a business of substantial size and scope
is dependent upon the creation of a high level of customer satisfaction among
one's clients. Studies have proven that customers demand service; a prerequisite
which ranks higher than any other product feature a telecom operator could
offer. NTL is built upon the fundamental premise that success in the
telecommunications industry is built upon outstanding customer service. This
philosophy is supported by various studies, one of the most compelling of which
was conducted by Deloitte and Touche Consulting.

WHAT TELECOMMUNICATION USERS WANT

<TABLE>
<S> <C>
Customer Service............................................ 43%
Operational Responsiveness.................................. 23%
Flexible Products........................................... 10%
Technical Reliability....................................... 9%
Pricing..................................................... 6%
Other....................................................... 9%
----
100%
</TABLE>

- ---------------
Source: Deloitte & Touche Consulting Group
Fourth Annual Telecommunications Competition Survey 1998

[EDGAR GRAPHIC DESCRIPTION: Illustration of NTL transmission tower and fiber
and coaxial cable and telephone wires for Business and Home customers. The tower
appears at the bottom left corner of the page and the telephone cables appear at
the bottom right of the page.]

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<PAGE> 39
CONCLUSION

The companies with which NTL's management have been associated have
demonstrated a high regard for long term customer relationships. NTL's
management has proven its focus upon customer satisfaction by the
industry-leading retention levels it achieved in the US cellular business and by
the very low cable and telephone disconnect rate (1% per month) it has recorded
in the United Kingdom.

Morgan Stanley Dean Witter performed a study in the context of assessing
their client's, COLT Telecom, position in the UK market. However, the survey
revealed that NTL is ranked #1 in customer service and on par with COLT Telecom
in customer satisfaction.

[EDGAR GRAPHIC DESCRIPTION: Bar graph titled "Morgan Stanley Dean Witter
Research" with list of telecommunications service providers shown on vertical
axis and numeric results of survey between one and ten on the horizontal axis.]

<TABLE>
<S> <C>
NTL 7.7
COLT 7.1
WORLDCOM 6.9
KINGSTON 6.8
RACAL 6.8
BT 6.8
CONCERT 6.7
C&WBN 6.7
AT&T 6.7
GLOBAL ONE 6.7
TELEWEST 6.6
CWC 6.5
ENERGIS 6.3
</TABLE>

[EDGAR GRAPHIC DESCRIPTION: Bar graph titled "Overall Satisfaction" with
list of telecommunications service providers shown on vertical axis and numeric
results of survey between one and ten on the horizontal axis.]

<TABLE>
<S> <C>
NTL 7.6
COLT 7.6
TELEWEST 7.5
WORLDCOM 7.3
GLOBAL ONE 7.0
BT 6.9
CWC 6.7
C&WBN 6.6
ENERGIS 6.6
RACAL 6.6
KINGSTON 6.4
AT&T 6.4
CONCERT 6.2
</TABLE>

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<PAGE> 40

[EDGAR GRAPHIC DESCRIPTION: NTL Incorporated Logo] VOTED #1
IN CUSTOMER MANAGEMENT IN 1999

Pricewaterhouse/Coopers Survey of Media Executives in England

[EDGAR GRAPHIC DESCRIPTION: NTL Incorporated Logo] VOTED #1
IN FIXED LINE AND PAY TV SERVICES,
UNITED KINGDOM IN 1999

J.D. Powers & Associates